Correlation Between Jones Soda and Sprott Focus

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

By analyzing existing cross correlation between Jones Soda Co and Sprott Focus Trust, you can compare the effects of market volatilities on Jones Soda and Sprott Focus 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 Jones Soda with a short position of Sprott Focus. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jones Soda and Sprott Focus.

Diversification Opportunities for Jones Soda and Sprott Focus

-0.28

Correlation Coefficient

Jones Soda  Sprott Focus

Very good diversification

The 3 months correlation between Jones and Sprott is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Jones Soda Co and Sprott Focus Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sprott Focus Trust and Jones Soda 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 Jones Soda Co are associated (or correlated) with Sprott Focus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sprott Focus Trust has no effect on the direction of Jones Soda i.e., Jones Soda and Sprott Focus go up and down completely randomly.

Pair Corralation between Jones Soda and Sprott Focus

Given the investment horizon of 90 days Jones Soda Co is expected to generate 5.4 times more return on investment than Sprott Focus. However, Jones Soda is 5.4 times more volatile than Sprott Focus Trust. It trades about 0.0 of its potential returns per unit of risk. Sprott Focus Trust is currently generating about 0.02 per unit of risk. If you would invest  18.00  in Jones Soda Co on August 26, 2025 and sell it today you would lose (1.00) from holding Jones Soda Co or give up 5.56% of portfolio value over 90 days.

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

Jones Soda Co  vs.  Sprott Focus Trust

Jones Soda

Risk-Adjusted Performance

Weakest

Over the last 90 days Jones Soda Co has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong fundamental indicators, Jones Soda is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

Sprott Focus Trust

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Sprott Focus Trust are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, Sprott Focus is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Jones Soda and Sprott Focus

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

The idea behind Jones Soda Co and Sprott Focus Trust 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.