Correlation Between J Sainsbury and Healthier Choices
Can any of the company-specific risk be diversified away by investing in both J Sainsbury and Healthier Choices 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 Sainsbury and Healthier Choices into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between J Sainsbury plc and Healthier Choices Management, you can compare the effects of market volatilities on J Sainsbury and Healthier Choices 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 Sainsbury with a short position of Healthier Choices. Check out your portfolio center. Please also check ongoing floating volatility patterns of J Sainsbury and Healthier Choices.
Diversification Opportunities for J Sainsbury and Healthier Choices
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between JSNSF and Healthier is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding J Sainsbury plc and Healthier Choices Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Healthier Choices and J Sainsbury 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 J Sainsbury plc are associated (or correlated) with Healthier Choices. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Healthier Choices has no effect on the direction of J Sainsbury i.e., J Sainsbury and Healthier Choices go up and down completely randomly.
Pair Corralation between J Sainsbury and Healthier Choices
Assuming the 90 days horizon J Sainsbury is expected to generate 160.49 times less return on investment than Healthier Choices. But when comparing it to its historical volatility, J Sainsbury plc is 64.03 times less risky than Healthier Choices. It trades about 0.14 of its potential returns per unit of risk. Healthier Choices Management is currently generating about 0.35 of returns per unit of risk over similar time horizon. If you would invest 0.00 in Healthier Choices Management on December 1, 2024 and sell it today you would earn a total of 0.00 from holding Healthier Choices Management or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
J Sainsbury plc vs. Healthier Choices Management
Performance |
| Timeline |
| J Sainsbury plc |
| Healthier Choices |
J Sainsbury and Healthier Choices Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with J Sainsbury and Healthier Choices
The main advantage of trading using opposite J Sainsbury and Healthier Choices positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if J Sainsbury position performs unexpectedly, Healthier Choices 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 Healthier Choices will offset losses from the drop in Healthier Choices' long position.| J Sainsbury vs. Kesko Oyj ADR | J Sainsbury vs. Om Holdings International | J Sainsbury vs. Carrefour SA PK | J Sainsbury vs. Carrefour SA |
| Healthier Choices vs. Albertsons Companies | Healthier Choices vs. Sprouts Farmers Market | Healthier Choices vs. Krispy Kreme | Healthier Choices vs. Grocery Outlet Holding |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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