Correlation Between National Vision and Jeffs Brands

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

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

Diversification Opportunities for National Vision and Jeffs Brands

-0.83

Correlation Coefficient

National Vision  Jeffs Brands

Pay attention - limited upside

The 3 months correlation between National and Jeffs is -0.83. Overlapping area represents the amount of risk that can be diversified away by holding National Vision Holdings and Jeffs Brands in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jeffs Brands and National Vision 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 National Vision Holdings are associated (or correlated) with Jeffs Brands. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jeffs Brands has no effect on the direction of National Vision i.e., National Vision and Jeffs Brands go up and down completely randomly.

Pair Corralation between National Vision and Jeffs Brands

Considering the 90-day investment horizon National Vision Holdings is expected to generate 0.61 times more return on investment than Jeffs Brands. However, National Vision Holdings is 1.63 times less risky than Jeffs Brands. It trades about 0.15 of its potential returns per unit of risk. Jeffs Brands is currently generating about -0.25 per unit of risk. If you would invest  1,010  in National Vision Holdings on December 28, 2024 and sell it today you would earn a total of  272.00  from holding National Vision Holdings or generate 26.93% return on investment over 90 days.

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

National Vision Holdings  vs.  Jeffs Brands

National Vision Holdings

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in National Vision Holdings are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of rather inconsistent basic indicators, National Vision exhibited solid returns over the last few months and may actually be approaching a breakup point.

Jeffs Brands

Risk-Adjusted Performance

Very Weak

Over the last 90 days Jeffs Brands has generated negative risk-adjusted returns adding no value to investors with long positions. Even with unsteady performance in the last few months, the Stock's fundamental drivers remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with National Vision and Jeffs Brands

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

The idea behind National Vision Holdings and Jeffs 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.

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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.