Correlation Between Jupiter Fund and Tencent Music
Can any of the company-specific risk be diversified away by investing in both Jupiter Fund and Tencent Music 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 Jupiter Fund and Tencent Music into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jupiter Fund Management and Tencent Music Entertainment, you can compare the effects of market volatilities on Jupiter Fund and Tencent Music 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 Jupiter Fund with a short position of Tencent Music. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jupiter Fund and Tencent Music.
Diversification Opportunities for Jupiter Fund and Tencent Music
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Jupiter and Tencent is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Jupiter Fund Management and Tencent Music Entertainment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tencent Music Entert and Jupiter Fund 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 Jupiter Fund Management are associated (or correlated) with Tencent Music. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tencent Music Entert has no effect on the direction of Jupiter Fund i.e., Jupiter Fund and Tencent Music go up and down completely randomly.
Pair Corralation between Jupiter Fund and Tencent Music
Assuming the 90 days horizon Jupiter Fund Management is expected to generate 0.61 times more return on investment than Tencent Music. However, Jupiter Fund Management is 1.63 times less risky than Tencent Music. It trades about -0.14 of its potential returns per unit of risk. Tencent Music Entertainment is currently generating about -0.12 per unit of risk. If you would invest 89.00 in Jupiter Fund Management on January 14, 2025 and sell it today you would lose (9.00) from holding Jupiter Fund Management or give up 10.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jupiter Fund Management vs. Tencent Music Entertainment
Performance |
| Timeline |
| Jupiter Fund Management |
| Tencent Music Entert |
Jupiter Fund and Tencent Music Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jupiter Fund and Tencent Music
The main advantage of trading using opposite Jupiter Fund and Tencent Music positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jupiter Fund position performs unexpectedly, Tencent Music 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 Tencent Music will offset losses from the drop in Tencent Music's long position.| Jupiter Fund vs. Geely Automobile Holdings | Jupiter Fund vs. Ming Le Sports | Jupiter Fund vs. SOEDER SPORTFISKE AB | Jupiter Fund vs. Sporting Clube de |
| Tencent Music vs. Taiwan Semiconductor Manufacturing | Tencent Music vs. Moneysupermarket Group PLC | Tencent Music vs. Tyson Foods | Tencent Music vs. High Liner Foods |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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