Correlation Between JB Hunt and Endo International

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

By analyzing existing cross correlation between JB Hunt Transport and Endo International PLC, you can compare the effects of market volatilities on JB Hunt and Endo International 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 JB Hunt with a short position of Endo International. Check out your portfolio center. Please also check ongoing floating volatility patterns of JB Hunt and Endo International.

Diversification Opportunities for JB Hunt and Endo International

-0.51

Correlation Coefficient

JB Hunt  Endo International

Excellent diversification

The 3 months correlation between 0J71 and Endo is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding JB Hunt Transport and Endo International PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Endo International PLC and JB Hunt 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 JB Hunt Transport are associated (or correlated) with Endo International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Endo International PLC has no effect on the direction of JB Hunt i.e., JB Hunt and Endo International go up and down completely randomly.

Pair Corralation between JB Hunt and Endo International

Assuming the 90 days trading horizon JB Hunt is expected to generate 342.49 times less return on investment than Endo International. But when comparing it to its historical volatility, JB Hunt Transport is 37.43 times less risky than Endo International. It trades about 0.01 of its potential returns per unit of risk. Endo International PLC is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  8.10  in Endo International PLC on September 23, 2024 and sell it today you would earn a total of  59,931  from holding Endo International PLC or generate 739887.65% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	53.24%
Values	Daily Returns

JB Hunt Transport  vs.  Endo International PLC

JB Hunt Transport

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days JB Hunt Transport has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, JB Hunt is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Endo International PLC

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Endo International PLC has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with JB Hunt and Endo International

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

The idea behind JB Hunt Transport and Endo International PLC 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.