Correlation Between JB Hunt and Mindflair Plc

Can any of the company-specific risk be diversified away by investing in both JB Hunt and Mindflair Plc 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 Mindflair Plc 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 Mindflair Plc, you can compare the effects of market volatilities on JB Hunt and Mindflair Plc 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 Mindflair Plc. Check out your portfolio center. Please also check ongoing floating volatility patterns of JB Hunt and Mindflair Plc.

Diversification Opportunities for JB Hunt and Mindflair Plc

0.59

Correlation Coefficient

JB Hunt  Mindflair Plc

Very weak diversification

The 3 months correlation between 0J71 and Mindflair is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding JB Hunt Transport and Mindflair Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mindflair 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 Mindflair Plc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mindflair Plc has no effect on the direction of JB Hunt i.e., JB Hunt and Mindflair Plc go up and down completely randomly.

Pair Corralation between JB Hunt and Mindflair Plc

Assuming the 90 days trading horizon JB Hunt Transport is expected to generate 0.22 times more return on investment than Mindflair Plc. However, JB Hunt Transport is 4.53 times less risky than Mindflair Plc. It trades about 0.01 of its potential returns per unit of risk. Mindflair Plc is currently generating about -0.01 per unit of risk. If you would invest  17,240  in JB Hunt Transport on October 4, 2024 and sell it today you would lose (173.00) from holding JB Hunt Transport or give up 1.0% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	95.99%
Values	Daily Returns

JB Hunt Transport  vs.  Mindflair Plc

JB Hunt Transport

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in JB Hunt Transport are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. 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.

Mindflair Plc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Mindflair Plc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in February 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with JB Hunt and Mindflair Plc

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

The idea behind JB Hunt Transport and Mindflair 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.