Correlation Between Jack In and Sonder Holdings

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

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

Diversification Opportunities for Jack In and Sonder Holdings

-0.76

Correlation Coefficient

Jack In  Sonder Holdings

Pay attention - limited upside

The 3 months correlation between Jack and Sonder is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Jack In The and Sonder Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sonder Holdings and Jack In 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 Jack In The are associated (or correlated) with Sonder Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sonder Holdings has no effect on the direction of Jack In i.e., Jack In and Sonder Holdings go up and down completely randomly.

Pair Corralation between Jack In and Sonder Holdings

Given the investment horizon of 90 days Jack In The is expected to generate 0.24 times more return on investment than Sonder Holdings. However, Jack In The is 4.13 times less risky than Sonder Holdings. It trades about 0.07 of its potential returns per unit of risk. Sonder Holdings is currently generating about -0.02 per unit of risk. If you would invest  4,441  in Jack In The on September 13, 2024 and sell it today you would earn a total of  405.00  from holding Jack In The or generate 9.12% return on investment over 90 days.

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

Jack In The  vs.  Sonder Holdings

Jack In

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Jack In The are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite quite unfluctuating fundamental indicators, Jack In may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Sonder Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Sonder Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest inconsistent performance, the Stock's basic indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Pair Trading with Jack In and Sonder Holdings

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

The idea behind Jack In The and Sonder Holdings 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.