Correlation Between Canadian Utilities and JD Sports

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

By analyzing existing cross correlation between Canadian Utilities Limited and JD Sports Fashion, you can compare the effects of market volatilities on Canadian Utilities 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 Canadian Utilities with a short position of JD Sports. Check out your portfolio center. Please also check ongoing floating volatility patterns of Canadian Utilities and JD Sports.

Diversification Opportunities for Canadian Utilities and JD Sports

-0.67

Correlation Coefficient

Canadian Utilities  JD Sports

Excellent diversification

The 3 months correlation between Canadian and JDSPY is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Canadian Utilities Limited 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 Canadian Utilities 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 Canadian Utilities Limited 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 Canadian Utilities i.e., Canadian Utilities and JD Sports go up and down completely randomly.

Pair Corralation between Canadian Utilities and JD Sports

Assuming the 90 days horizon Canadian Utilities Limited is expected to generate 0.06 times more return on investment than JD Sports. However, Canadian Utilities Limited is 16.81 times less risky than JD Sports. It trades about 0.13 of its potential returns per unit of risk. JD Sports Fashion is currently generating about -0.07 per unit of risk. If you would invest  1,597  in Canadian Utilities Limited on August 20, 2025 and sell it today you would earn a total of  24.00  from holding Canadian Utilities Limited or generate 1.5% return on investment over 90 days.

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

Canadian Utilities Limited  vs.  JD Sports Fashion

Canadian Utilities

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Canadian Utilities Limited are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable essential indicators, Canadian Utilities is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

JD Sports Fashion

Risk-Adjusted Performance

Weakest

Over the last 90 days JD Sports Fashion has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in December 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Canadian Utilities and JD Sports

The main advantage of trading using opposite Canadian Utilities and JD Sports positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Canadian Utilities 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.

The idea behind Canadian Utilities Limited and JD Sports Fashion 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.

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 CEOs Directory module to screen CEOs from public companies around the world.