Correlation Between Jupiter Fund and Bunzl PLC
Can any of the company-specific risk be diversified away by investing in both Jupiter Fund and Bunzl PLC 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 Bunzl PLC 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 Bunzl PLC, you can compare the effects of market volatilities on Jupiter Fund and Bunzl PLC 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 Bunzl PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jupiter Fund and Bunzl PLC.
Diversification Opportunities for Jupiter Fund and Bunzl PLC
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Jupiter and Bunzl is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Jupiter Fund Management and Bunzl PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bunzl 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 Bunzl PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bunzl PLC has no effect on the direction of Jupiter Fund i.e., Jupiter Fund and Bunzl PLC go up and down completely randomly.
Pair Corralation between Jupiter Fund and Bunzl PLC
Assuming the 90 days trading horizon Jupiter Fund is expected to generate 3.41 times less return on investment than Bunzl PLC. In addition to that, Jupiter Fund is 1.6 times more volatile than Bunzl PLC. It trades about 0.02 of its total potential returns per unit of risk. Bunzl PLC is currently generating about 0.12 per unit of volatility. If you would invest 295,273 in Bunzl PLC on September 1, 2024 and sell it today you would earn a total of 58,327 from holding Bunzl PLC or generate 19.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.23% |
| Values | Daily Returns |
Jupiter Fund Management vs. Bunzl PLC
Performance |
| Timeline |
| Jupiter Fund Management |
| Bunzl PLC |
Jupiter Fund and Bunzl PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jupiter Fund and Bunzl PLC
The main advantage of trading using opposite Jupiter Fund and Bunzl PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jupiter Fund position performs unexpectedly, Bunzl PLC 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 Bunzl PLC will offset losses from the drop in Bunzl PLC's long position.| Jupiter Fund vs. Livermore Investments Group | Jupiter Fund vs. Eco Animal Health | Jupiter Fund vs. Bellevue Healthcare Trust | Jupiter Fund vs. The Investment |
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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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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