Correlation Between JD SPORTS and Synchrony Financial

Can any of the company-specific risk be diversified away by investing in both JD SPORTS and Synchrony Financial 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 JD SPORTS and Synchrony Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between JD SPORTS FASH and Synchrony Financial, you can compare the effects of market volatilities on JD SPORTS and Synchrony Financial 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 JD SPORTS with a short position of Synchrony Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of JD SPORTS and Synchrony Financial.

Diversification Opportunities for JD SPORTS and Synchrony Financial

-0.63

Correlation Coefficient

JD SPORTS  Synchrony Financial

Excellent diversification

The 3 months correlation between 9JD and Synchrony is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding JD SPORTS FASH and Synchrony Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Synchrony Financial and JD SPORTS 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 JD SPORTS FASH are associated (or correlated) with Synchrony Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Synchrony Financial has no effect on the direction of JD SPORTS i.e., JD SPORTS and Synchrony Financial go up and down completely randomly.

Pair Corralation between JD SPORTS and Synchrony Financial

Assuming the 90 days horizon JD SPORTS FASH is expected to under-perform the Synchrony Financial. In addition to that, JD SPORTS is 1.51 times more volatile than Synchrony Financial. It trades about -0.05 of its total potential returns per unit of risk. Synchrony Financial is currently generating about 0.08 per unit of volatility. If you would invest  6,425  in Synchrony Financial on September 11, 2025 and sell it today you would earn a total of  536.00  from holding Synchrony Financial or generate 8.34% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

JD SPORTS FASH  vs.  Synchrony Financial

JD SPORTS FASH

Risk-Adjusted Performance

Weakest

Over the last 90 days JD SPORTS FASH has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Synchrony Financial

Risk-Adjusted Performance

Mild

Compared to the overall equity markets, risk-adjusted returns on investments in Synchrony Financial are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite nearly unsteady basic indicators, Synchrony Financial may actually be approaching a critical reversion point that can send shares even higher in January 2026.

Pair Trading with JD SPORTS and Synchrony Financial

The main advantage of trading using opposite JD SPORTS and Synchrony Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JD SPORTS position performs unexpectedly, Synchrony Financial 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 Synchrony Financial will offset losses from the drop in Synchrony Financial's long position.

The idea behind JD SPORTS FASH and Synchrony Financial pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.