Correlation Between Supercom and JD Sports
Can any of the company-specific risk be diversified away by investing in both Supercom and JD Sports 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 Supercom and JD Sports into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Supercom and JD Sports Fashion, you can compare the effects of market volatilities on Supercom and JD Sports 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 Supercom with a short position of JD Sports. Check out your portfolio center. Please also check ongoing floating volatility patterns of Supercom and JD Sports.
Diversification Opportunities for Supercom and JD Sports
Good diversification
The 3 months correlation between Supercom and JDDSF is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Supercom and JD Sports Fashion in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JD Sports Fashion and Supercom 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 Supercom are associated (or correlated) with JD Sports. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JD Sports Fashion has no effect on the direction of Supercom i.e., Supercom and JD Sports go up and down completely randomly.
Pair Corralation between Supercom and JD Sports
Given the investment horizon of 90 days Supercom is expected to under-perform the JD Sports. In addition to that, Supercom is 4.17 times more volatile than JD Sports Fashion. It trades about -0.01 of its total potential returns per unit of risk. JD Sports Fashion is currently generating about -0.01 per unit of volatility. If you would invest 189.00 in JD Sports Fashion on August 31, 2024 and sell it today you would lose (43.00) from holding JD Sports Fashion or give up 22.75% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.73% |
| Values | Daily Returns |
Supercom vs. JD Sports Fashion
Performance |
| Timeline |
| Supercom |
| JD Sports Fashion |
Supercom and JD Sports Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Supercom and JD Sports
The main advantage of trading using opposite Supercom and JD Sports positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Supercom position performs unexpectedly, JD Sports 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 JD Sports will offset losses from the drop in JD Sports' long position.| Supercom vs. Zedcor Inc | Supercom vs. SSC Security Services | Supercom vs. Blue Line Protection | Supercom vs. Guardforce AI Co |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
Other Complementary Tools
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device |