Correlation Between JB Hunt and Radiant Logistics

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

Diversification Opportunities for JB Hunt and Radiant Logistics

0.67

Correlation Coefficient

JB Hunt  Radiant Logistics

Poor diversification

The 3 months correlation between JBHT and Radiant is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding JB Hunt Transport and Radiant Logistics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Radiant Logistics 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 Radiant Logistics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Radiant Logistics has no effect on the direction of JB Hunt i.e., JB Hunt and Radiant Logistics go up and down completely randomly.

Pair Corralation between JB Hunt and Radiant Logistics

Given the investment horizon of 90 days JB Hunt Transport is expected to under-perform the Radiant Logistics. But the stock apears to be less risky and, when comparing its historical volatility, JB Hunt Transport is 1.17 times less risky than Radiant Logistics. The stock trades about -0.12 of its potential returns per unit of risk. The Radiant Logistics is currently generating about -0.05 of returns per unit of risk over similar time horizon. If you would invest  669.00  in Radiant Logistics on December 28, 2024 and sell it today you would lose (53.00) from holding Radiant Logistics or give up 7.92% of portfolio value over 90 days.

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

JB Hunt Transport  vs.  Radiant Logistics

JB Hunt Transport

Risk-Adjusted Performance

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 unsteady performance in the last few months, the Stock's technical 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.

Radiant Logistics

Risk-Adjusted Performance

Very Weak

Over the last 90 days Radiant Logistics has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's technical and fundamental 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 Radiant Logistics

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

The idea behind JB Hunt Transport and Radiant Logistics 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.