Correlation Between JC Penney and T.J. Maxx
Can any of the company-specific risk be diversified away by investing in both JC Penney and T.J. Maxx 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 T.J. Maxx 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 The TJX Companies, you can compare the effects of market volatilities on JC Penney and T.J. Maxx 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 T.J. Maxx. Check out your portfolio center. Please also check ongoing floating volatility patterns of JC Penney and T.J. Maxx.
Diversification Opportunities for JC Penney and T.J. Maxx
Pay attention - limited upside
The 16 months correlation between JCP and T.J. is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding J C Penney and The TJX Companies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TJX Companies 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 T.J. Maxx. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TJX Companies has no effect on the direction of JC Penney i.e., JC Penney and T.J. Maxx go up and down completely randomly.
Pair Corralation between JC Penney and T.J. Maxx
If you would invest (100.00) in J C Penney on January 26, 2024 and sell it today you would earn a total of 100.00 from holding J C Penney or generate -100.0% return on investment over 90 days.
| Time Period | 16 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
J C Penney vs. The TJX Companies
Performance |
| Timeline |
| J C Penney |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| TJX Companies |
JC Penney and T.J. Maxx Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JC Penney and T.J. Maxx
The main advantage of trading using opposite JC Penney and T.J. Maxx positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JC Penney position performs unexpectedly, T.J. Maxx 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 T.J. Maxx will offset losses from the drop in T.J. Maxx's long position.| JC Penney vs. Brandywine Realty Trust | JC Penney vs. Monster Beverage Corp | JC Penney vs. Wallbox NV | JC Penney vs. BRP Inc |
| T.J. Maxx vs. Burlington Stores | T.J. Maxx vs. Guess Inc | T.J. Maxx vs. Urban Outfitters | T.J. Maxx vs. Childrens Place |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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