Correlation Between Jupiter Fund and Cars
Can any of the company-specific risk be diversified away by investing in both Jupiter Fund and Cars 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 Cars 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 Cars Inc, you can compare the effects of market volatilities on Jupiter Fund and Cars 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 Cars. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jupiter Fund and Cars.
Diversification Opportunities for Jupiter Fund and Cars
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Jupiter and Cars is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Jupiter Fund Management and Cars Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cars Inc 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 Cars. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cars Inc has no effect on the direction of Jupiter Fund i.e., Jupiter Fund and Cars go up and down completely randomly.
Pair Corralation between Jupiter Fund and Cars
Assuming the 90 days horizon Jupiter Fund is expected to generate 7.8 times less return on investment than Cars. But when comparing it to its historical volatility, Jupiter Fund Management is 2.45 times less risky than Cars. It trades about 0.12 of its potential returns per unit of risk. Cars Inc is currently generating about 0.37 of returns per unit of risk over similar time horizon. If you would invest 1,460 in Cars Inc on September 1, 2024 and sell it today you would earn a total of 400.00 from holding Cars Inc or generate 27.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jupiter Fund Management vs. Cars Inc
Performance |
| Timeline |
| Jupiter Fund Management |
| Cars Inc |
Jupiter Fund and Cars Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jupiter Fund and Cars
The main advantage of trading using opposite Jupiter Fund and Cars positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jupiter Fund position performs unexpectedly, Cars 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 Cars will offset losses from the drop in Cars' long position.| Jupiter Fund vs. Harmony Gold Mining | Jupiter Fund vs. NH HOTEL GROUP | Jupiter Fund vs. ADRIATIC METALS LS 013355 | Jupiter Fund vs. Zijin Mining Group |
| Cars vs. Eastman Chemical | Cars vs. GRIFFIN MINING LTD | Cars vs. Shin Etsu Chemical Co | Cars vs. KINGBOARD CHEMICAL |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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