Correlation Between JetBlue Airways and BrightSpring Health
Can any of the company-specific risk be diversified away by investing in both JetBlue Airways and BrightSpring Health 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 JetBlue Airways and BrightSpring Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JetBlue Airways Corp and BrightSpring Health Services,, you can compare the effects of market volatilities on JetBlue Airways and BrightSpring Health 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 JetBlue Airways with a short position of BrightSpring Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of JetBlue Airways and BrightSpring Health.
Diversification Opportunities for JetBlue Airways and BrightSpring Health
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between JetBlue and BrightSpring is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding JetBlue Airways Corp and BrightSpring Health Services, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BrightSpring Health and JetBlue Airways 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 JetBlue Airways Corp are associated (or correlated) with BrightSpring Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BrightSpring Health has no effect on the direction of JetBlue Airways i.e., JetBlue Airways and BrightSpring Health go up and down completely randomly.
Pair Corralation between JetBlue Airways and BrightSpring Health
Given the investment horizon of 90 days JetBlue Airways is expected to generate 4.04 times less return on investment than BrightSpring Health. In addition to that, JetBlue Airways is 1.26 times more volatile than BrightSpring Health Services,. It trades about 0.07 of its total potential returns per unit of risk. BrightSpring Health Services, is currently generating about 0.38 per unit of volatility. If you would invest 5,593 in BrightSpring Health Services, on September 1, 2024 and sell it today you would earn a total of 1,520 from holding BrightSpring Health Services, or generate 27.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
JetBlue Airways Corp vs. BrightSpring Health Services,
Performance |
| Timeline |
| JetBlue Airways Corp |
| BrightSpring Health |
JetBlue Airways and BrightSpring Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JetBlue Airways and BrightSpring Health
The main advantage of trading using opposite JetBlue Airways and BrightSpring Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JetBlue Airways position performs unexpectedly, BrightSpring Health 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 BrightSpring Health will offset losses from the drop in BrightSpring Health's long position.| JetBlue Airways vs. Canadian Pacific Railway | JetBlue Airways vs. Werner Enterprises | JetBlue Airways vs. Canadian National Railway | JetBlue Airways vs. CSX Corporation |
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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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