Correlation Between Kraft Heinz and J+J SNACK
Can any of the company-specific risk be diversified away by investing in both Kraft Heinz and J+J SNACK 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 Kraft Heinz and J+J SNACK into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kraft Heinz Co and JJ SNACK FOODS, you can compare the effects of market volatilities on Kraft Heinz and J+J SNACK 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 Kraft Heinz with a short position of J+J SNACK. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kraft Heinz and J+J SNACK.
Diversification Opportunities for Kraft Heinz and J+J SNACK
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Kraft and J+J is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Kraft Heinz Co and JJ SNACK FOODS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JJ SNACK FOODS and Kraft Heinz 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 Kraft Heinz Co are associated (or correlated) with J+J SNACK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JJ SNACK FOODS has no effect on the direction of Kraft Heinz i.e., Kraft Heinz and J+J SNACK go up and down completely randomly.
Pair Corralation between Kraft Heinz and J+J SNACK
Assuming the 90 days trading horizon Kraft Heinz Co is expected to under-perform the J+J SNACK. In addition to that, Kraft Heinz is 2.11 times more volatile than JJ SNACK FOODS. It trades about -0.03 of its total potential returns per unit of risk. JJ SNACK FOODS is currently generating about -0.04 per unit of volatility. If you would invest 16,300 in JJ SNACK FOODS on September 12, 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 Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kraft Heinz Co vs. JJ SNACK FOODS
Performance |
| Timeline |
| Kraft Heinz |
| JJ SNACK FOODS |
Kraft Heinz and J+J SNACK Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kraft Heinz and J+J SNACK
The main advantage of trading using opposite Kraft Heinz and J+J SNACK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kraft Heinz position performs unexpectedly, J+J SNACK 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 J+J SNACK will offset losses from the drop in J+J SNACK's long position.| Kraft Heinz vs. Hormel Foods | Kraft Heinz vs. Superior Plus Corp | Kraft Heinz vs. SIVERS SEMICONDUCTORS AB | Kraft Heinz vs. NorAm Drilling AS |
| 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 |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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