Correlation Between JJill and Sothebys

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

By analyzing existing cross correlation between JJill Inc and Sothebys 7375 percent, you can compare the effects of market volatilities on JJill and Sothebys 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 JJill with a short position of Sothebys. Check out your portfolio center. Please also check ongoing floating volatility patterns of JJill and Sothebys.

Diversification Opportunities for JJill and Sothebys

0.62

Correlation Coefficient

JJill  Sothebys

Poor diversification

The 3 months correlation between JJill and Sothebys is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding JJill Inc and Sothebys 7375 percent in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sothebys 7375 percent and JJill 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 JJill Inc are associated (or correlated) with Sothebys. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sothebys 7375 percent has no effect on the direction of JJill i.e., JJill and Sothebys go up and down completely randomly.

Pair Corralation between JJill and Sothebys

Given the investment horizon of 90 days JJill Inc is expected to generate 0.82 times more return on investment than Sothebys. However, JJill Inc is 1.23 times less risky than Sothebys. It trades about -0.04 of its potential returns per unit of risk. Sothebys 7375 percent is currently generating about -0.26 per unit of risk. If you would invest  2,816  in JJill Inc on October 13, 2024 and sell it today you would lose (70.00) from holding JJill Inc or give up 2.49% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	84.21%
Values	Daily Returns

JJill Inc  vs.  Sothebys 7375 percent

JJill Inc

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in JJill Inc are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite quite unfluctuating essential indicators, JJill disclosed solid returns over the last few months and may actually be approaching a breakup point.

Sothebys 7375 percent

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Sothebys 7375 percent has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Bond's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for Sothebys 7375 percent investors.

Pair Trading with JJill and Sothebys

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

The idea behind JJill Inc and Sothebys 7375 percent 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.