Correlation Between Johnson Outdoors and Funko

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

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

Diversification Opportunities for Johnson Outdoors and Funko

0.71

Correlation Coefficient

Johnson Outdoors  Funko

Poor diversification

The 3 months correlation between Johnson and Funko is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Johnson Outdoors and Funko Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Funko Inc and Johnson Outdoors 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 Johnson Outdoors are associated (or correlated) with Funko. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Funko Inc has no effect on the direction of Johnson Outdoors i.e., Johnson Outdoors and Funko go up and down completely randomly.

Pair Corralation between Johnson Outdoors and Funko

Given the investment horizon of 90 days Johnson Outdoors is expected to generate 0.67 times more return on investment than Funko. However, Johnson Outdoors is 1.48 times less risky than Funko. It trades about -0.18 of its potential returns per unit of risk. Funko Inc is currently generating about -0.3 per unit of risk. If you would invest  3,268  in Johnson Outdoors on December 28, 2024 and sell it today you would lose (756.00) from holding Johnson Outdoors or give up 23.13% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.36%
Values	Daily Returns

Johnson Outdoors  vs.  Funko Inc

Johnson Outdoors

Risk-Adjusted Performance

Very Weak

Over the last 90 days Johnson Outdoors has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak 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.

Funko Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Funko Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's forward-looking signals remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with Johnson Outdoors and Funko

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

The idea behind Johnson Outdoors and Funko Inc 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.