Correlation Between Farmer Bros and J J

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

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

Diversification Opportunities for Farmer Bros and J J

-0.35

Correlation Coefficient

Farmer Bros  J J

Very good diversification

The 3 months correlation between Farmer and JJSF is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Farmer Bros Co 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 Farmer Bros 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 Farmer Bros Co 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 Farmer Bros i.e., Farmer Bros and J J go up and down completely randomly.

Pair Corralation between Farmer Bros and J J

Given the investment horizon of 90 days Farmer Bros Co is expected to generate 3.11 times more return on investment than J J. However, Farmer Bros is 3.11 times more volatile than J J Snack. It trades about 0.09 of its potential returns per unit of risk. J J Snack is currently generating about -0.16 per unit of risk. If you would invest  144.00  in Farmer Bros Co on July 9, 2025 and sell it today you would earn a total of  36.00  from holding Farmer Bros Co or generate 25.0% return on investment over 90 days.

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

Farmer Bros Co  vs.  J J Snack

Farmer Bros

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Farmer Bros Co are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of very weak basic indicators, Farmer Bros displayed solid returns over the last few months and may actually be approaching a breakup point.

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 abnormal performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in November 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Farmer Bros and J J

The main advantage of trading using opposite Farmer Bros and J J positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Farmer Bros 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 Farmer Bros Co 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.