Correlation Between Ambev SA and John B

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

By analyzing existing cross correlation between Ambev SA ADR and John B Sanfilippo, you can compare the effects of market volatilities on Ambev SA and John B 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 Ambev SA with a short position of John B. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ambev SA and John B.

Diversification Opportunities for Ambev SA and John B

-0.6

Correlation Coefficient

Ambev SA  John B

Excellent diversification

The 3 months correlation between Ambev and John is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Ambev SA ADR and John B Sanfilippo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on John B Sanfilippo and Ambev SA 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 Ambev SA ADR are associated (or correlated) with John B. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of John B Sanfilippo has no effect on the direction of Ambev SA i.e., Ambev SA and John B go up and down completely randomly.

Pair Corralation between Ambev SA and John B

Given the investment horizon of 90 days Ambev SA ADR is expected to generate 0.96 times more return on investment than John B. However, Ambev SA ADR is 1.04 times less risky than John B. It trades about 0.0 of its potential returns per unit of risk. John B Sanfilippo is currently generating about -0.03 per unit of risk. If you would invest  251.00  in Ambev SA ADR on December 28, 2024 and sell it today you would lose (20.00) from holding Ambev SA ADR or give up 7.97% of portfolio value over 90 days.

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

Ambev SA ADR  vs.  John B Sanfilippo

Ambev SA ADR

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Ambev SA ADR are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak technical and fundamental indicators, Ambev SA showed solid returns over the last few months and may actually be approaching a breakup point.

John B Sanfilippo

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Ambev SA and John B

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

The idea behind Ambev SA ADR and John B Sanfilippo 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.