Correlation Between Jupiter Fund and Westlake Chemical
Can any of the company-specific risk be diversified away by investing in both Jupiter Fund and Westlake Chemical 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 Westlake Chemical 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 Westlake Chemical Corp, you can compare the effects of market volatilities on Jupiter Fund and Westlake Chemical 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 Westlake Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jupiter Fund and Westlake Chemical.
Diversification Opportunities for Jupiter Fund and Westlake Chemical
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Jupiter and Westlake is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Jupiter Fund Management and Westlake Chemical Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Westlake Chemical Corp 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 Westlake Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Westlake Chemical Corp has no effect on the direction of Jupiter Fund i.e., Jupiter Fund and Westlake Chemical go up and down completely randomly.
Pair Corralation between Jupiter Fund and Westlake Chemical
Assuming the 90 days trading horizon Jupiter Fund Management is expected to under-perform the Westlake Chemical. In addition to that, Jupiter Fund is 1.02 times more volatile than Westlake Chemical Corp. It trades about -0.01 of its total potential returns per unit of risk. Westlake Chemical Corp is currently generating about 0.04 per unit of volatility. If you would invest 10,405 in Westlake Chemical Corp on August 30, 2024 and sell it today you would earn a total of 2,479 from holding Westlake Chemical Corp or generate 23.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 76.46% |
| Values | Daily Returns |
Jupiter Fund Management vs. Westlake Chemical Corp
Performance |
| Timeline |
| Jupiter Fund Management |
| Westlake Chemical Corp |
Jupiter Fund and Westlake Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jupiter Fund and Westlake Chemical
The main advantage of trading using opposite Jupiter Fund and Westlake Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jupiter Fund position performs unexpectedly, Westlake Chemical 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 Westlake Chemical will offset losses from the drop in Westlake Chemical's long position.| Jupiter Fund vs. Toyota Motor Corp | Jupiter Fund vs. Lendinvest PLC | Jupiter Fund vs. Neometals | Jupiter Fund vs. Coor Service Management |
| Westlake Chemical vs. Lendinvest PLC | Westlake Chemical vs. Neometals | Westlake Chemical vs. Albion Technology General | Westlake Chemical vs. Jupiter Fund Management |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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