Correlation Between JD Sports and NCR Corp
Can any of the company-specific risk be diversified away by investing in both JD Sports and NCR Corp 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 JD Sports and NCR Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JD Sports Fashion and NCR Corp Pref, you can compare the effects of market volatilities on JD Sports and NCR Corp 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 JD Sports with a short position of NCR Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of JD Sports and NCR Corp.
Diversification Opportunities for JD Sports and NCR Corp
Pay attention - limited upside
The 3 months correlation between JDSPY and NCR is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding JD Sports Fashion and NCR Corp Pref in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NCR Corp Pref and JD Sports 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 JD Sports Fashion are associated (or correlated) with NCR Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NCR Corp Pref has no effect on the direction of JD Sports i.e., JD Sports and NCR Corp go up and down completely randomly.
Pair Corralation between JD Sports and NCR Corp
If you would invest (100.00) in NCR Corp Pref on December 18, 2024 and sell it today you would earn a total of 100.00 from holding NCR Corp Pref or generate -100.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 0.0% |
Values | Daily Returns |
JD Sports Fashion vs. NCR Corp Pref
Performance |
Timeline |
JD Sports Fashion |
NCR Corp Pref |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
JD Sports and NCR Corp Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with JD Sports and NCR Corp
The main advantage of trading using opposite JD Sports and NCR Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JD Sports position performs unexpectedly, NCR Corp 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 NCR Corp will offset losses from the drop in NCR Corp's long position.JD Sports vs. Burlington Stores | JD Sports vs. Childrens Place | JD Sports vs. Buckle Inc | JD Sports vs. Shoe Carnival |
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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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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