Correlation Between JD Sports and Usio

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

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

Diversification Opportunities for JD Sports and Usio

0.69

Correlation Coefficient

JD Sports  Usio

Poor diversification

The 3 months correlation between JDDSF and Usio is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding JD Sports Fashion and Usio Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Usio Inc and JD Sports 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 JD Sports Fashion are associated (or correlated) with Usio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Usio Inc has no effect on the direction of JD Sports i.e., JD Sports and Usio go up and down completely randomly.

Pair Corralation between JD Sports and Usio

Assuming the 90 days horizon JD Sports Fashion is expected to generate 1.19 times more return on investment than Usio. However, JD Sports is 1.19 times more volatile than Usio Inc. It trades about 0.1 of its potential returns per unit of risk. Usio Inc is currently generating about 0.05 per unit of risk. If you would invest  101.00  in JD Sports Fashion on May 1, 2025 and sell it today you would earn a total of  19.00  from holding JD Sports Fashion or generate 18.81% return on investment over 90 days.

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

JD Sports Fashion  vs.  Usio Inc

JD Sports Fashion

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in JD Sports Fashion are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, JD Sports reported solid returns over the last few months and may actually be approaching a breakup point.

Usio Inc

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Usio Inc are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of very fragile forward indicators, Usio may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with JD Sports and Usio

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

The idea behind JD Sports Fashion and Usio Inc 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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.