Correlation Between JERONIMO MARTINS and Jernimo Martins
Can any of the company-specific risk be diversified away by investing in both JERONIMO MARTINS and Jernimo Martins 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 JERONIMO MARTINS and Jernimo Martins into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JERONIMO MARTINS UNADR2 and Jernimo Martins SGPS, you can compare the effects of market volatilities on JERONIMO MARTINS and Jernimo Martins 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 JERONIMO MARTINS with a short position of Jernimo Martins. Check out your portfolio center. Please also check ongoing floating volatility patterns of JERONIMO MARTINS and Jernimo Martins.
Diversification Opportunities for JERONIMO MARTINS and Jernimo Martins
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between JERONIMO and Jernimo is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding JERONIMO MARTINS UNADR2 and Jernimo Martins SGPS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jernimo Martins SGPS and JERONIMO MARTINS 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 JERONIMO MARTINS UNADR2 are associated (or correlated) with Jernimo Martins. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jernimo Martins SGPS has no effect on the direction of JERONIMO MARTINS i.e., JERONIMO MARTINS and Jernimo Martins go up and down completely randomly.
Pair Corralation between JERONIMO MARTINS and Jernimo Martins
Assuming the 90 days trading horizon JERONIMO MARTINS is expected to generate 1.0 times less return on investment than Jernimo Martins. But when comparing it to its historical volatility, JERONIMO MARTINS UNADR2 is 1.07 times less risky than Jernimo Martins. It trades about 0.08 of its potential returns per unit of risk. Jernimo Martins SGPS is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 1,655 in Jernimo Martins SGPS on September 23, 2024 and sell it today you would earn a total of 150.00 from holding Jernimo Martins SGPS or generate 9.06% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Strong |
Accuracy | 100.0% |
Values | Daily Returns |
JERONIMO MARTINS UNADR2 vs. Jernimo Martins SGPS
Performance |
Timeline |
JERONIMO MARTINS UNADR2 |
Jernimo Martins SGPS |
JERONIMO MARTINS and Jernimo Martins Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with JERONIMO MARTINS and Jernimo Martins
The main advantage of trading using opposite JERONIMO MARTINS and Jernimo Martins positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JERONIMO MARTINS position performs unexpectedly, Jernimo Martins 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 Jernimo Martins will offset losses from the drop in Jernimo Martins' long position.JERONIMO MARTINS vs. Sysco | JERONIMO MARTINS vs. Jernimo Martins SGPS | JERONIMO MARTINS vs. Performance Food Group | JERONIMO MARTINS vs. US Foods Holding |
Jernimo Martins vs. Shin Etsu Chemical Co | Jernimo Martins vs. PTT Global Chemical | Jernimo Martins vs. Waste Management | Jernimo Martins vs. China BlueChemical |
Check out your portfolio center.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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
Other Complementary Tools
Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
Volatility Analysis Get historical volatility and risk analysis based on latest market data |