Correlation Between JD SPORTS and TRIPCOM GROUP
Can any of the company-specific risk be diversified away by investing in both JD SPORTS and TRIPCOM GROUP 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 TRIPCOM GROUP into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JD SPORTS FASH and TRIPCOM GROUP DL 00125, you can compare the effects of market volatilities on JD SPORTS and TRIPCOM GROUP 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 TRIPCOM GROUP. Check out your portfolio center. Please also check ongoing floating volatility patterns of JD SPORTS and TRIPCOM GROUP.
Diversification Opportunities for JD SPORTS and TRIPCOM GROUP
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between 9JD and TRIPCOM is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding JD SPORTS FASH and TRIPCOM GROUP DL 00125 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TRIPCOM GROUP DL 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 FASH are associated (or correlated) with TRIPCOM GROUP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TRIPCOM GROUP DL has no effect on the direction of JD SPORTS i.e., JD SPORTS and TRIPCOM GROUP go up and down completely randomly.
Pair Corralation between JD SPORTS and TRIPCOM GROUP
Assuming the 90 days horizon JD SPORTS FASH is expected to generate 0.9 times more return on investment than TRIPCOM GROUP. However, JD SPORTS FASH is 1.11 times less risky than TRIPCOM GROUP. It trades about 0.08 of its potential returns per unit of risk. TRIPCOM GROUP DL 00125 is currently generating about 0.06 per unit of risk. If you would invest 85.00 in JD SPORTS FASH on April 21, 2025 and sell it today you would earn a total of 11.00 from holding JD SPORTS FASH or generate 12.94% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
JD SPORTS FASH vs. TRIPCOM GROUP DL 00125
Performance |
Timeline |
JD SPORTS FASH |
TRIPCOM GROUP DL |
JD SPORTS and TRIPCOM GROUP Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with JD SPORTS and TRIPCOM GROUP
The main advantage of trading using opposite JD SPORTS and TRIPCOM GROUP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JD SPORTS position performs unexpectedly, TRIPCOM GROUP 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 TRIPCOM GROUP will offset losses from the drop in TRIPCOM GROUP's long position.JD SPORTS vs. STMicroelectronics NV | JD SPORTS vs. ARROW ELECTRONICS | JD SPORTS vs. TT Electronics PLC | JD SPORTS vs. Perdoceo Education |
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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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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