Correlation Between Papa Johns and Jack In

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

By analyzing existing cross correlation between Papa Johns International and Jack In The, you can compare the effects of market volatilities on Papa Johns and Jack In 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 Papa Johns with a short position of Jack In. Check out your portfolio center. Please also check ongoing floating volatility patterns of Papa Johns and Jack In.

Diversification Opportunities for Papa Johns and Jack In

-0.35

Correlation Coefficient

Papa Johns  Jack In

Very good diversification

The 3 months correlation between Papa and Jack is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Papa Johns International and Jack In The in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jack In and Papa Johns 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 Papa Johns International are associated (or correlated) with Jack In. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jack In has no effect on the direction of Papa Johns i.e., Papa Johns and Jack In go up and down completely randomly.

Pair Corralation between Papa Johns and Jack In

Given the investment horizon of 90 days Papa Johns International is expected to generate 1.2 times more return on investment than Jack In. However, Papa Johns is 1.2 times more volatile than Jack In The. It trades about 0.04 of its potential returns per unit of risk. Jack In The is currently generating about -0.16 per unit of risk. If you would invest  3,903  in Papa Johns International on December 27, 2024 and sell it today you would earn a total of  199.00  from holding Papa Johns International or generate 5.1% return on investment over 90 days.

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

Papa Johns International  vs.  Jack In The

Papa Johns International

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Papa Johns International are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unfluctuating basic indicators, Papa Johns may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Jack In

Risk-Adjusted Performance

Very Weak

Over the last 90 days Jack In The has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's fundamental indicators remain quite persistent which may send shares a bit higher in April 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with Papa Johns and Jack In

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

The idea behind Papa Johns International and Jack In The 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.