Correlation Between John Marshall and Nike

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Can any of the company-specific risk be diversified away by investing in both John Marshall and Nike 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 John Marshall and Nike into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between John Marshall Bk and Nike Inc, you can compare the effects of market volatilities on John Marshall and Nike 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 John Marshall with a short position of Nike. Check out your portfolio center. Please also check ongoing floating volatility patterns of John Marshall and Nike.

Diversification Opportunities for John Marshall and Nike

-0.76
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between John Marshall and Nike is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding John Marshall Bk and Nike Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nike Inc and John Marshall 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 John Marshall Bk are associated (or correlated) with Nike. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nike Inc has no effect on the direction of John Marshall i.e., John Marshall and Nike go up and down completely randomly.

Pair Corralation between John Marshall and Nike

Given the investment horizon of 90 days John Marshall Bk is expected to generate 0.62 times more return on investment than Nike. However, John Marshall Bk is 1.61 times less risky than Nike. It trades about 0.1 of its potential returns per unit of risk. Nike Inc is currently generating about -0.01 per unit of risk. If you would invest  1,741  in John Marshall Bk on March 27, 2022 and sell it today you would earn a total of  709.00  from holding John Marshall Bk or generate 40.72% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthWeak
Accuracy99.66%
ValuesDaily Returns

John Marshall Bk  vs.  Nike Inc

 Performance (%) 
      Timeline 
John Marshall Bk 
John Marshall Performance
6 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in John Marshall Bk are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, John Marshall sustained solid returns over the last few months and may actually be approaching a breakup point.

Structure and Payout Changes

Payout Ratio
0.13
Last Split Factor
125:100
Dividend Date
2022-05-24
Ex Dividend Date
2022-05-09
Last Split Date
2017-09-06

John Marshall Price Channel

Nike Inc 
Nike Performance
0 of 100
Over the last 90 days Nike Inc 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 forward-looking signals remain rather sound which may send shares a bit higher in July 2022. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Structure and Payout Changes

Forward Annual Dividend Yield
0.0113
Payout Ratio
0.31
Last Split Factor
2:1
Forward Annual Dividend Rate
1.22
Dividend Date
2022-07-01
Ex Dividend Date
2022-06-03
Last Split Date
2015-12-24

Nike Price Channel

John Marshall and Nike Volatility Contrast

 Predicted Return Density 
      Returns 

Pair Trading with John Marshall and Nike

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

John Marshall Bk

Pair trading matchups for John Marshall

The idea behind John Marshall Bk and Nike 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.
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.

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