Correlation Between J J and Simply Good
Can any of the company-specific risk be diversified away by investing in both J J and Simply Good 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 J J and Simply Good into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between J J Snack and Simply Good Foods, you can compare the effects of market volatilities on J J and Simply Good 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 J J with a short position of Simply Good. Check out your portfolio center. Please also check ongoing floating volatility patterns of J J and Simply Good.
Diversification Opportunities for J J and Simply Good
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between JJSF and Simply is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding J J Snack and Simply Good Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Simply Good Foods and J J 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 J Snack are associated (or correlated) with Simply Good. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Simply Good Foods has no effect on the direction of J J i.e., J J and Simply Good go up and down completely randomly.
Pair Corralation between J J and Simply Good
Given the investment horizon of 90 days J J Snack is expected to generate 1.08 times more return on investment than Simply Good. However, J J is 1.08 times more volatile than Simply Good Foods. It trades about -0.06 of its potential returns per unit of risk. Simply Good Foods is currently generating about -0.24 per unit of risk. If you would invest 11,422 in J J Snack on March 30, 2025 and sell it today you would lose (254.00) from holding J J Snack or give up 2.22% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
J J Snack vs. Simply Good Foods
Performance |
| Timeline |
| J J Snack |
| Simply Good Foods |
J J and Simply Good Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with J J and Simply Good
The main advantage of trading using opposite J J and Simply Good positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if J J position performs unexpectedly, Simply Good 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 Simply Good will offset losses from the drop in Simply Good's long position.The idea behind J J Snack and Simply Good Foods 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.| Simply Good vs. Post Holdings | Simply Good vs. Treehouse Foods | Simply Good vs. J J Snack | Simply Good vs. Central Garden Pet |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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