Correlation Between J J and Utz Brands

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

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

Diversification Opportunities for J J and Utz Brands

0.31

Correlation Coefficient

J J  Utz Brands

Weak diversification

The 3 months correlation between JJSF and Utz is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding J J Snack and Utz Brands in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Utz Brands and J J 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 J Snack are associated (or correlated) with Utz Brands. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Utz Brands has no effect on the direction of J J i.e., J J and Utz Brands go up and down completely randomly.

Pair Corralation between J J and Utz Brands

Given the investment horizon of 90 days J J is expected to generate 1.59 times less return on investment than Utz Brands. But when comparing it to its historical volatility, J J Snack is 1.32 times less risky than Utz Brands. It trades about 0.08 of its potential returns per unit of risk. Utz Brands is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest  1,621  in Utz Brands on August 31, 2024 and sell it today you would earn a total of  82.00  from holding Utz Brands or generate 5.06% return on investment over 90 days.

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

J J Snack  vs.  Utz Brands

J J Snack

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in J J Snack are ranked lower than 1 (%) 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.

Utz Brands

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with J J and Utz Brands

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

The idea behind J J Snack and Utz Brands 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.