Correlation Between JB Hunt and FedEx

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

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

Diversification Opportunities for JB Hunt and FedEx

0.93

Correlation Coefficient

JB Hunt  FedEx

Almost no diversification

The 3 months correlation between JBHT and FedEx is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding JB Hunt Transport and FedEx in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FedEx and JB Hunt 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 JB Hunt Transport are associated (or correlated) with FedEx. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FedEx has no effect on the direction of JB Hunt i.e., JB Hunt and FedEx go up and down completely randomly.

Pair Corralation between JB Hunt and FedEx

Given the investment horizon of 90 days JB Hunt is expected to generate 1.1 times less return on investment than FedEx. In addition to that, JB Hunt is 1.15 times more volatile than FedEx. It trades about 0.11 of its total potential returns per unit of risk. FedEx is currently generating about 0.14 per unit of volatility. If you would invest  20,898  in FedEx on April 30, 2025 and sell it today you would earn a total of  3,343  from holding FedEx or generate 16.0% return on investment over 90 days.

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

JB Hunt Transport  vs.  FedEx

JB Hunt Transport

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in JB Hunt Transport are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady technical indicators, JB Hunt unveiled solid returns over the last few months and may actually be approaching a breakup point.

FedEx

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in FedEx are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unfluctuating fundamental indicators, FedEx showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with JB Hunt and FedEx

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

The idea behind JB Hunt Transport and FedEx 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.