Correlation Between Foreign Trade and JBS NV

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

By analyzing existing cross correlation between Foreign Trade Bank and JBS NV, you can compare the effects of market volatilities on Foreign Trade and JBS NV 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 Foreign Trade with a short position of JBS NV. Check out your portfolio center. Please also check ongoing floating volatility patterns of Foreign Trade and JBS NV.

Diversification Opportunities for Foreign Trade and JBS NV

0.71

Correlation Coefficient

Foreign Trade  JBS NV

Poor diversification

The 3 months correlation between Foreign and JBS is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Foreign Trade Bank and JBS NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JBS NV and Foreign Trade 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 Foreign Trade Bank are associated (or correlated) with JBS NV. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JBS NV has no effect on the direction of Foreign Trade i.e., Foreign Trade and JBS NV go up and down completely randomly.

Pair Corralation between Foreign Trade and JBS NV

Considering the 90-day investment horizon Foreign Trade Bank is expected to generate 0.74 times more return on investment than JBS NV. However, Foreign Trade Bank is 1.35 times less risky than JBS NV. It trades about 0.0 of its potential returns per unit of risk. JBS NV is currently generating about -0.08 per unit of risk. If you would invest  4,522  in Foreign Trade Bank on August 31, 2025 and sell it today you would lose (9.00) from holding Foreign Trade Bank or give up 0.2% of portfolio value over 90 days.

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

Foreign Trade Bank  vs.  JBS NV

Foreign Trade Bank

Risk-Adjusted Performance

Weakest

Over the last 90 days Foreign Trade Bank has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong essential indicators, Foreign Trade is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

JBS NV

Risk-Adjusted Performance

Weakest

Over the last 90 days JBS NV has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest fragile performance, the Stock's fundamental drivers remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with Foreign Trade and JBS NV

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

The idea behind Foreign Trade Bank and JBS NV 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.