Correlation Between J Sainsbury and Consorcio ARA

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

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

Diversification Opportunities for J Sainsbury and Consorcio ARA

-0.07

Correlation Coefficient

J Sainsbury  Consorcio ARA

Good diversification

The 3 months correlation between JSNSF and Consorcio is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding J Sainsbury plc and Consorcio ARA S in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Consorcio ARA S and J Sainsbury 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 Sainsbury plc are associated (or correlated) with Consorcio ARA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Consorcio ARA S has no effect on the direction of J Sainsbury i.e., J Sainsbury and Consorcio ARA go up and down completely randomly.

Pair Corralation between J Sainsbury and Consorcio ARA

Assuming the 90 days horizon J Sainsbury plc is expected to generate 0.03 times more return on investment than Consorcio ARA. However, J Sainsbury plc is 33.08 times less risky than Consorcio ARA. It trades about 0.08 of its potential returns per unit of risk. Consorcio ARA S is currently generating about -0.2 per unit of risk. If you would invest  342.00  in J Sainsbury plc on April 30, 2025 and sell it today you would earn a total of  65.00  from holding J Sainsbury plc or generate 19.01% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.39%
Values	Daily Returns

J Sainsbury plc  vs.  Consorcio ARA S

J Sainsbury plc

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in J Sainsbury plc are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak basic indicators, J Sainsbury reported solid returns over the last few months and may actually be approaching a breakup point.

Consorcio ARA S

Risk-Adjusted Performance

Very Weak

Over the last 90 days Consorcio ARA S has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's technical and fundamental indicators remain nearly stable which may send shares a bit higher in August 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with J Sainsbury and Consorcio ARA

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

The idea behind J Sainsbury plc and Consorcio ARA S 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.