Correlation Between Johnson Outdoors and Madison Square
Can any of the company-specific risk be diversified away by investing in both Johnson Outdoors and Madison Square 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 Johnson Outdoors and Madison Square into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Johnson Outdoors and Madison Square Garden, you can compare the effects of market volatilities on Johnson Outdoors and Madison Square 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 Johnson Outdoors with a short position of Madison Square. Check out your portfolio center. Please also check ongoing floating volatility patterns of Johnson Outdoors and Madison Square.
Diversification Opportunities for Johnson Outdoors and Madison Square
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Johnson and Madison is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Johnson Outdoors and Madison Square Garden in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Madison Square Garden and Johnson Outdoors 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 Johnson Outdoors are associated (or correlated) with Madison Square. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Madison Square Garden has no effect on the direction of Johnson Outdoors i.e., Johnson Outdoors and Madison Square go up and down completely randomly.
Pair Corralation between Johnson Outdoors and Madison Square
Given the investment horizon of 90 days Johnson Outdoors is expected to generate 1.68 times less return on investment than Madison Square. In addition to that, Johnson Outdoors is 1.79 times more volatile than Madison Square Garden. It trades about 0.03 of its total potential returns per unit of risk. Madison Square Garden is currently generating about 0.09 per unit of volatility. If you would invest 3,560 in Madison Square Garden on November 1, 2024 and sell it today you would earn a total of 70.00 from holding Madison Square Garden or generate 1.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Johnson Outdoors vs. Madison Square Garden
Performance |
| Timeline |
| Johnson Outdoors |
| Madison Square Garden |
Johnson Outdoors and Madison Square Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Johnson Outdoors and Madison Square
The main advantage of trading using opposite Johnson Outdoors and Madison Square positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Johnson Outdoors position performs unexpectedly, Madison Square 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 Madison Square will offset losses from the drop in Madison Square's long position.| Johnson Outdoors vs. Clarus Corp | Johnson Outdoors vs. Escalade Incorporated | Johnson Outdoors vs. JAKKS Pacific | Johnson Outdoors vs. Six Flags Entertainment |
| Madison Square vs. Madison Square Garden | Madison Square vs. Graham Holdings Co | Madison Square vs. Atlanta Braves Holdings, | Madison Square vs. Live Nation Entertainment |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
Other Complementary Tools
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance |