Correlation Between First Bancorp and J J

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

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

Diversification Opportunities for First Bancorp and J J

0.49

Correlation Coefficient

First Bancorp  J J

Very weak diversification

The 3 months correlation between First and JJSF is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding First Bancorp 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 First Bancorp 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 First Bancorp 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 First Bancorp i.e., First Bancorp and J J go up and down completely randomly.

Pair Corralation between First Bancorp and J J

Considering the 90-day investment horizon First Bancorp is expected to generate 0.74 times more return on investment than J J. However, First Bancorp is 1.35 times less risky than J J. It trades about 0.13 of its potential returns per unit of risk. J J Snack is currently generating about 0.04 per unit of risk. If you would invest  2,006  in First Bancorp on May 28, 2025 and sell it today you would earn a total of  224.50  from holding First Bancorp or generate 11.19% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.41%
Values	Daily Returns

First Bancorp  vs.  J J Snack

First Bancorp

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in First Bancorp are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Even with relatively fragile fundamental drivers, First Bancorp may actually be approaching a critical reversion point that can send shares even higher in September 2025.

J J Snack

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in J J Snack are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, J J is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with First Bancorp and J J

The main advantage of trading using opposite First Bancorp and J J positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Bancorp 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 First Bancorp 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.