Correlation Between Brown Forman and J J

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

By analyzing existing cross correlation between Brown Forman and J J Snack, you can compare the effects of market volatilities on Brown Forman and J J 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 Brown Forman with a short position of J J. Check out your portfolio center. Please also check ongoing floating volatility patterns of Brown Forman and J J.

Diversification Opportunities for Brown Forman and J J

0.09

Correlation Coefficient

Brown Forman  J J

Significant diversification

The 3 months correlation between Brown and JJSF is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Brown Forman and J J Snack in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on J J Snack and Brown Forman 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 Brown Forman are associated (or correlated) with J J. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of J J Snack has no effect on the direction of Brown Forman i.e., Brown Forman and J J go up and down completely randomly.

Pair Corralation between Brown Forman and J J

Given the investment horizon of 90 days Brown Forman is expected to generate 0.99 times more return on investment than J J. However, Brown Forman is 1.01 times less risky than J J. It trades about 0.07 of its potential returns per unit of risk. J J Snack is currently generating about -0.13 per unit of risk. If you would invest  2,783  in Brown Forman on September 11, 2025 and sell it today you would earn a total of  174.00  from holding Brown Forman or generate 6.25% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	98.44%
Values	Daily Returns

Brown Forman  vs.  J J Snack

Brown Forman

Risk-Adjusted Performance

Mild

Compared to the overall equity markets, risk-adjusted returns on investments in Brown Forman are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Brown Forman may actually be approaching a critical reversion point that can send shares even higher in January 2026.

J J Snack

Risk-Adjusted Performance

Weakest

Over the last 90 days J J Snack has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in January 2026. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Brown Forman and J J

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

The idea behind Brown Forman and J J Snack 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.