Correlation Between Rocky Brands and JBG SMITH
Can any of the company-specific risk be diversified away by investing in both Rocky Brands and JBG SMITH 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 Rocky Brands and JBG SMITH into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Rocky Brands and JBG SMITH Properties, you can compare the effects of market volatilities on Rocky Brands and JBG SMITH 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 Rocky Brands with a short position of JBG SMITH. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rocky Brands and JBG SMITH.
Diversification Opportunities for Rocky Brands and JBG SMITH
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Rocky and JBG is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Rocky Brands and JBG SMITH Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JBG SMITH Properties and Rocky Brands 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 Rocky Brands are associated (or correlated) with JBG SMITH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JBG SMITH Properties has no effect on the direction of Rocky Brands i.e., Rocky Brands and JBG SMITH go up and down completely randomly.
Pair Corralation between Rocky Brands and JBG SMITH
Given the investment horizon of 90 days Rocky Brands is expected to generate 1.21 times more return on investment than JBG SMITH. However, Rocky Brands is 1.21 times more volatile than JBG SMITH Properties. It trades about 0.19 of its potential returns per unit of risk. JBG SMITH Properties is currently generating about 0.09 per unit of risk. If you would invest 2,239 in Rocky Brands on October 20, 2024 and sell it today you would earn a total of 178.00 from holding Rocky Brands or generate 7.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Rocky Brands vs. JBG SMITH Properties
Performance |
| Timeline |
| Rocky Brands |
| JBG SMITH Properties |
Rocky Brands and JBG SMITH Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rocky Brands and JBG SMITH
The main advantage of trading using opposite Rocky Brands and JBG SMITH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rocky Brands position performs unexpectedly, JBG SMITH 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 JBG SMITH will offset losses from the drop in JBG SMITH's long position.| Rocky Brands vs. Vera Bradley | Rocky Brands vs. Steven Madden | Rocky Brands vs. Wolverine World Wide | Rocky Brands vs. Caleres |
| JBG SMITH vs. Cousins Properties Incorporated | JBG SMITH vs. Highwoods Properties | JBG SMITH vs. Douglas Emmett | JBG SMITH vs. Equity Commonwealth |
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 Correlations module to find global opportunities by holding instruments from different markets.
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