Correlation Between Johnson Outdoors and Superior Uniform
Can any of the company-specific risk be diversified away by investing in both Johnson Outdoors and Superior Uniform 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 Superior Uniform into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Johnson Outdoors and Superior Uniform Group, you can compare the effects of market volatilities on Johnson Outdoors and Superior Uniform 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 Superior Uniform. Check out your portfolio center. Please also check ongoing floating volatility patterns of Johnson Outdoors and Superior Uniform.
Diversification Opportunities for Johnson Outdoors and Superior Uniform
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Johnson and Superior is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Johnson Outdoors and Superior Uniform Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Superior Uniform 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 Superior Uniform. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Superior Uniform has no effect on the direction of Johnson Outdoors i.e., Johnson Outdoors and Superior Uniform go up and down completely randomly.
Pair Corralation between Johnson Outdoors and Superior Uniform
Given the investment horizon of 90 days Johnson Outdoors is expected to under-perform the Superior Uniform. But the stock apears to be less risky and, when comparing its historical volatility, Johnson Outdoors is 1.5 times less risky than Superior Uniform. The stock trades about -0.05 of its potential returns per unit of risk. The Superior Uniform Group is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 981.00 in Superior Uniform Group on November 1, 2024 and sell it today you would earn a total of 583.00 from holding Superior Uniform Group or generate 59.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Johnson Outdoors vs. Superior Uniform Group
Performance |
| Timeline |
| Johnson Outdoors |
| Superior Uniform |
Johnson Outdoors and Superior Uniform Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Johnson Outdoors and Superior Uniform
The main advantage of trading using opposite Johnson Outdoors and Superior Uniform positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Johnson Outdoors position performs unexpectedly, Superior Uniform 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 Superior Uniform will offset losses from the drop in Superior Uniform's long position.| Johnson Outdoors vs. Clarus Corp | Johnson Outdoors vs. Escalade Incorporated | Johnson Outdoors vs. JAKKS Pacific | Johnson Outdoors vs. Six Flags Entertainment |
| Superior Uniform vs. Lakeland Industries | Superior Uniform vs. Jerash Holdings | Superior Uniform vs. G III Apparel Group | Superior Uniform vs. Gildan Activewear |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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