Correlation Between Jupiter Fund and Arrow Electronics
Can any of the company-specific risk be diversified away by investing in both Jupiter Fund and Arrow Electronics 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 Arrow Electronics 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 Arrow Electronics, you can compare the effects of market volatilities on Jupiter Fund and Arrow Electronics 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 Arrow Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jupiter Fund and Arrow Electronics.
Diversification Opportunities for Jupiter Fund and Arrow Electronics
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Jupiter and Arrow is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Jupiter Fund Management and Arrow Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Arrow Electronics 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 Arrow Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Arrow Electronics has no effect on the direction of Jupiter Fund i.e., Jupiter Fund and Arrow Electronics go up and down completely randomly.
Pair Corralation between Jupiter Fund and Arrow Electronics
Assuming the 90 days trading horizon Jupiter Fund Management is expected to generate 0.38 times more return on investment than Arrow Electronics. However, Jupiter Fund Management is 2.62 times less risky than Arrow Electronics. It trades about 0.09 of its potential returns per unit of risk. Arrow Electronics is currently generating about -0.11 per unit of risk. If you would invest 8,140 in Jupiter Fund Management on August 27, 2024 and sell it today you would earn a total of 180.00 from holding Jupiter Fund Management or generate 2.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jupiter Fund Management vs. Arrow Electronics
Performance |
| Timeline |
| Jupiter Fund Management |
| Arrow Electronics |
Jupiter Fund and Arrow Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jupiter Fund and Arrow Electronics
The main advantage of trading using opposite Jupiter Fund and Arrow Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jupiter Fund position performs unexpectedly, Arrow Electronics 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 Arrow Electronics will offset losses from the drop in Arrow Electronics' long position.| Jupiter Fund vs. Empire Metals Limited | Jupiter Fund vs. European Metals Holdings | Jupiter Fund vs. Adriatic Metals | Jupiter Fund vs. Cairo Communication SpA |
| Arrow Electronics vs. Samsung Electronics Co | Arrow Electronics vs. Samsung Electronics Co | Arrow Electronics vs. Hyundai Motor | Arrow Electronics vs. Toyota Motor Corp |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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