Correlation Between Jupiter Fund and Ashtead Group
Can any of the company-specific risk be diversified away by investing in both Jupiter Fund and Ashtead Group 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 Ashtead Group 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 Ashtead Group PLC, you can compare the effects of market volatilities on Jupiter Fund and Ashtead Group 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 Ashtead Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jupiter Fund and Ashtead Group.
Diversification Opportunities for Jupiter Fund and Ashtead Group
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between Jupiter and Ashtead is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Jupiter Fund Management and Ashtead Group PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ashtead Group PLC 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 Ashtead Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ashtead Group PLC has no effect on the direction of Jupiter Fund i.e., Jupiter Fund and Ashtead Group go up and down completely randomly.
Pair Corralation between Jupiter Fund and Ashtead Group
Assuming the 90 days trading horizon Jupiter Fund Management is expected to under-perform the Ashtead Group. In addition to that, Jupiter Fund is 2.21 times more volatile than Ashtead Group PLC. It trades about -0.12 of its total potential returns per unit of risk. Ashtead Group PLC is currently generating about 0.38 per unit of volatility. If you would invest 494,182 in Ashtead Group PLC on October 24, 2024 and sell it today you would earn a total of 52,418 from holding Ashtead Group PLC or generate 10.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jupiter Fund Management vs. Ashtead Group PLC
Performance |
| Timeline |
| Jupiter Fund Management |
| Ashtead Group PLC |
Jupiter Fund and Ashtead Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jupiter Fund and Ashtead Group
The main advantage of trading using opposite Jupiter Fund and Ashtead Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jupiter Fund position performs unexpectedly, Ashtead Group 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 Ashtead Group will offset losses from the drop in Ashtead Group's long position.| Jupiter Fund vs. Universal Music Group | Jupiter Fund vs. Fevertree Drinks Plc | Jupiter Fund vs. Sydbank | Jupiter Fund vs. Electronic Arts |
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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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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