Correlation Between J J and J M

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

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

Diversification Opportunities for J J and J M

-0.1

Correlation Coefficient

J J  J M

Good diversification

The 3 months correlation between JJSF and SJM is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding J J Snack and The J M in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on J M and J J 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 J J Snack are associated (or correlated) with J M. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of J M has no effect on the direction of J J i.e., J J and J M go up and down completely randomly.

Pair Corralation between J J and J M

Given the investment horizon of 90 days J J Snack is expected to generate 0.76 times more return on investment than J M. However, J J Snack is 1.31 times less risky than J M. It trades about 0.03 of its potential returns per unit of risk. The J M is currently generating about 0.02 per unit of risk. If you would invest  11,273  in J J Snack on May 26, 2025 and sell it today you would earn a total of  324.00  from holding J J Snack or generate 2.87% return on investment over 90 days.

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

J J Snack  vs.  The J M

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.

J M

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in The J M are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy forward-looking indicators, J M is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with J J and J M

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

The idea behind J J Snack and The J M 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.