Correlation Between PPHE Hotel and JB Hunt
Can any of the company-specific risk be diversified away by investing in both PPHE Hotel 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 PPHE Hotel and JB Hunt into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PPHE Hotel Group and JB Hunt Transport, you can compare the effects of market volatilities on PPHE Hotel 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 PPHE Hotel with a short position of JB Hunt. Check out your portfolio center. Please also check ongoing floating volatility patterns of PPHE Hotel and JB Hunt.
Diversification Opportunities for PPHE Hotel and JB Hunt
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between PPHE and 0J71 is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding PPHE Hotel 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 PPHE Hotel 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 PPHE Hotel 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 PPHE Hotel i.e., PPHE Hotel and JB Hunt go up and down completely randomly.
Pair Corralation between PPHE Hotel and JB Hunt
Assuming the 90 days trading horizon PPHE Hotel Group is expected to under-perform the JB Hunt. But the stock apears to be less risky and, when comparing its historical volatility, PPHE Hotel Group is 1.82 times less risky than JB Hunt. The stock trades about -0.22 of its potential returns per unit of risk. The JB Hunt Transport is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 18,172 in JB Hunt Transport on September 4, 2024 and sell it today you would earn a total of 738.00 from holding JB Hunt Transport or generate 4.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PPHE Hotel Group vs. JB Hunt Transport
Performance |
| Timeline |
| PPHE Hotel Group |
| JB Hunt Transport |
PPHE Hotel and JB Hunt Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PPHE Hotel and JB Hunt
The main advantage of trading using opposite PPHE Hotel and JB Hunt positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PPHE Hotel 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.| PPHE Hotel vs. BYD Co | PPHE Hotel vs. Volkswagen AG | PPHE Hotel vs. Volkswagen AG Non Vtg | PPHE Hotel vs. Compass Group PLC |
| JB Hunt vs. Samsung Electronics Co | JB Hunt vs. Samsung Electronics Co | JB Hunt vs. Hyundai Motor | JB Hunt vs. Toyota Motor Corp |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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