Correlation Between Lloyds Banking and JB Hunt
Can any of the company-specific risk be diversified away by investing in both Lloyds Banking and JB Hunt 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 Lloyds Banking and JB Hunt into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lloyds Banking Group and JB Hunt Transport, you can compare the effects of market volatilities on Lloyds Banking and JB Hunt 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 Lloyds Banking with a short position of JB Hunt. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lloyds Banking and JB Hunt.
Diversification Opportunities for Lloyds Banking and JB Hunt
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Lloyds and J1BH34 is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Lloyds Banking Group and JB Hunt Transport in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JB Hunt Transport and Lloyds Banking 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 Lloyds Banking Group are associated (or correlated) with JB Hunt. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JB Hunt Transport has no effect on the direction of Lloyds Banking i.e., Lloyds Banking and JB Hunt go up and down completely randomly.
Pair Corralation between Lloyds Banking and JB Hunt
Assuming the 90 days trading horizon Lloyds Banking Group is expected to generate 4.12 times more return on investment than JB Hunt. However, Lloyds Banking is 4.12 times more volatile than JB Hunt Transport. It trades about 0.12 of its potential returns per unit of risk. JB Hunt Transport is currently generating about 0.21 per unit of risk. If you would invest 1,679 in Lloyds Banking Group on November 7, 2024 and sell it today you would earn a total of 115.00 from holding Lloyds Banking Group or generate 6.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 91.3% |
| Values | Daily Returns |
Lloyds Banking Group vs. JB Hunt Transport
Performance |
| Timeline |
| Lloyds Banking Group |
| JB Hunt Transport |
Lloyds Banking and JB Hunt Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lloyds Banking and JB Hunt
The main advantage of trading using opposite Lloyds Banking and JB Hunt positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lloyds Banking position performs unexpectedly, JB Hunt 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 JB Hunt will offset losses from the drop in JB Hunt's long position.| Lloyds Banking vs. Banco Santander Chile | Lloyds Banking vs. KeyCorp | Lloyds Banking vs. Wetzel SA | Lloyds Banking vs. The Bank of |
| JB Hunt vs. T Mobile | JB Hunt vs. BIONTECH SE DRN | JB Hunt vs. Nordon Indstrias Metalrgicas | JB Hunt vs. Guidewire Software, |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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