Correlation Between J+J SNACK and Perma-Fix Environmental
Can any of the company-specific risk be diversified away by investing in both J+J SNACK and Perma-Fix Environmental at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining J+J SNACK and Perma-Fix Environmental into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JJ SNACK FOODS and Perma Fix Environmental Services, you can compare the effects of market volatilities on J+J SNACK and Perma-Fix Environmental and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in J+J SNACK with a short position of Perma-Fix Environmental. Check out your portfolio center. Please also check ongoing floating volatility patterns of J+J SNACK and Perma-Fix Environmental.
Diversification Opportunities for J+J SNACK and Perma-Fix Environmental
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between J+J and Perma-Fix is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding JJ SNACK FOODS and Perma Fix Environmental Servic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Perma Fix Environmental and J+J SNACK is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on JJ SNACK FOODS are associated (or correlated) with Perma-Fix Environmental. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Perma Fix Environmental has no effect on the direction of J+J SNACK i.e., J+J SNACK and Perma-Fix Environmental go up and down completely randomly.
Pair Corralation between J+J SNACK and Perma-Fix Environmental
Assuming the 90 days trading horizon JJ SNACK FOODS is expected to generate 0.17 times more return on investment than Perma-Fix Environmental. However, JJ SNACK FOODS is 6.03 times less risky than Perma-Fix Environmental. It trades about -0.04 of its potential returns per unit of risk. Perma Fix Environmental Services is currently generating about -0.14 per unit of risk. If you would invest 16,300 in JJ SNACK FOODS on September 14, 2024 and sell it today you would lose (100.00) from holding JJ SNACK FOODS or give up 0.61% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
JJ SNACK FOODS vs. Perma Fix Environmental Servic
Performance |
| Timeline |
| JJ SNACK FOODS |
| Perma Fix Environmental |
J+J SNACK and Perma-Fix Environmental Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with J+J SNACK and Perma-Fix Environmental
The main advantage of trading using opposite J+J SNACK and Perma-Fix Environmental positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if J+J SNACK position performs unexpectedly, Perma-Fix Environmental can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Perma-Fix Environmental will offset losses from the drop in Perma-Fix Environmental's long position.| J+J SNACK vs. Hormel Foods | J+J SNACK vs. Superior Plus Corp | J+J SNACK vs. SIVERS SEMICONDUCTORS AB | J+J SNACK vs. NorAm Drilling AS |
| Perma-Fix Environmental vs. Apple Inc | Perma-Fix Environmental vs. Apple Inc | Perma-Fix Environmental vs. Apple Inc | Perma-Fix Environmental vs. Apple Inc |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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