Correlation Between JC Penney and Spectrum Brands
Can any of the company-specific risk be diversified away by investing in both JC Penney and Spectrum Brands 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 JC Penney and Spectrum Brands into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between J C Penney and Spectrum Brands Holdings, you can compare the effects of market volatilities on JC Penney and Spectrum Brands 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 JC Penney with a short position of Spectrum Brands. Check out your portfolio center. Please also check ongoing floating volatility patterns of JC Penney and Spectrum Brands.
Diversification Opportunities for JC Penney and Spectrum Brands
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between JCP and Spectrum is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding J C Penney and Spectrum Brands Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Spectrum Brands Holdings and JC Penney 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 J C Penney are associated (or correlated) with Spectrum Brands. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Spectrum Brands Holdings has no effect on the direction of JC Penney i.e., JC Penney and Spectrum Brands go up and down completely randomly.
Pair Corralation between JC Penney and Spectrum Brands
If you would invest 8,048 in Spectrum Brands Holdings on December 29, 2023 and sell it today you would earn a total of 843.00 from holding Spectrum Brands Holdings or generate 10.47% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 0.0% |
Values | Daily Returns |
J C Penney vs. Spectrum Brands Holdings
Performance |
Timeline |
J C Penney |
Risk-Adjusted Performance
0 of 100
Low | High |
Very Weak
Spectrum Brands Holdings |
JC Penney and Spectrum Brands Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with JC Penney and Spectrum Brands
The main advantage of trading using opposite JC Penney and Spectrum Brands positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JC Penney position performs unexpectedly, Spectrum Brands 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 Spectrum Brands will offset losses from the drop in Spectrum Brands' long position.JC Penney vs. NorthWestern | JC Penney vs. Black Hills | JC Penney vs. Kinetik Holdings | JC Penney vs. Nabors Industries |
Spectrum Brands vs. Estee Lauder Companies | Spectrum Brands vs. United Guardian | Spectrum Brands vs. Unilever PLC ADR | Spectrum Brands vs. Veru Inc |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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