Correlation Between J Sainsbury and Natural Grocers
Can any of the company-specific risk be diversified away by investing in both J Sainsbury and Natural Grocers 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 Natural Grocers 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 Natural Grocers by, you can compare the effects of market volatilities on J Sainsbury and Natural Grocers 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 Natural Grocers. Check out your portfolio center. Please also check ongoing floating volatility patterns of J Sainsbury and Natural Grocers.
Diversification Opportunities for J Sainsbury and Natural Grocers
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between JSNSF and Natural is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding J Sainsbury plc and Natural Grocers by in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Natural Grocers by 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 Natural Grocers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Natural Grocers by has no effect on the direction of J Sainsbury i.e., J Sainsbury and Natural Grocers go up and down completely randomly.
Pair Corralation between J Sainsbury and Natural Grocers
Assuming the 90 days horizon J Sainsbury plc is expected to under-perform the Natural Grocers. But the otc stock apears to be less risky and, when comparing its historical volatility, J Sainsbury plc is 1.2 times less risky than Natural Grocers. The otc stock trades about -0.01 of its potential returns per unit of risk. The Natural Grocers by is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 3,408 in Natural Grocers by on September 13, 2024 and sell it today you would earn a total of 976.00 from holding Natural Grocers by or generate 28.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
J Sainsbury plc vs. Natural Grocers by
Performance |
| Timeline |
| J Sainsbury plc |
| Natural Grocers by |
J Sainsbury and Natural Grocers Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with J Sainsbury and Natural Grocers
The main advantage of trading using opposite J Sainsbury and Natural Grocers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if J Sainsbury position performs unexpectedly, Natural Grocers 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 Natural Grocers will offset losses from the drop in Natural Grocers' long position.| J Sainsbury vs. Natural Grocers by | J Sainsbury vs. Grocery Outlet Holding | J Sainsbury vs. Village Super Market | J Sainsbury vs. Ingles Markets Incorporated |
| Natural Grocers vs. Weis Markets | Natural Grocers vs. Ingles Markets Incorporated | Natural Grocers vs. Sendas Distribuidora SA | Natural Grocers 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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