Correlation Between Alexanders and J J

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

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

Diversification Opportunities for Alexanders and J J

0.21

Correlation Coefficient

Alexanders  J J

Modest diversification

The 3 months correlation between Alexanders and JJSF is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Alexanders and J J Snack in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on J J Snack and Alexanders 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 Alexanders are associated (or correlated) with J J. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of J J Snack has no effect on the direction of Alexanders i.e., Alexanders and J J go up and down completely randomly.

Pair Corralation between Alexanders and J J

Considering the 90-day investment horizon Alexanders is expected to under-perform the J J. In addition to that, Alexanders is 1.08 times more volatile than J J Snack. It trades about 0.0 of its total potential returns per unit of risk. J J Snack is currently generating about 0.03 per unit of volatility. If you would invest  16,984  in J J Snack on September 3, 2024 and sell it today you would earn a total of  395.00  from holding J J Snack or generate 2.33% return on investment over 90 days.

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

Alexanders  vs.  J J Snack

Alexanders

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Alexanders has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong essential indicators, Alexanders is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

J J Snack

Risk-Adjusted Performance

2 of 100

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 newest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Alexanders and J J

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

The idea behind Alexanders and J J Snack 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.