Correlation Between Jupiter Fund and Carnival PLC
Can any of the company-specific risk be diversified away by investing in both Jupiter Fund and Carnival 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 Carnival 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 Carnival PLC, you can compare the effects of market volatilities on Jupiter Fund and Carnival 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 Carnival PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jupiter Fund and Carnival PLC.
Diversification Opportunities for Jupiter Fund and Carnival PLC
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Jupiter and Carnival is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Jupiter Fund Management and Carnival PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Carnival 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 Carnival PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Carnival PLC has no effect on the direction of Jupiter Fund i.e., Jupiter Fund and Carnival PLC go up and down completely randomly.
Pair Corralation between Jupiter Fund and Carnival PLC
Assuming the 90 days trading horizon Jupiter Fund Management is expected to under-perform the Carnival PLC. But the stock apears to be less risky and, when comparing its historical volatility, Jupiter Fund Management is 1.26 times less risky than Carnival PLC. The stock trades about -0.01 of its potential returns per unit of risk. The Carnival PLC is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 62,040 in Carnival PLC on September 5, 2024 and sell it today you would earn a total of 124,610 from holding Carnival PLC or generate 200.85% 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. Carnival PLC
Performance |
| Timeline |
| Jupiter Fund Management |
| Carnival PLC |
Jupiter Fund and Carnival PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jupiter Fund and Carnival PLC
The main advantage of trading using opposite Jupiter Fund and Carnival PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jupiter Fund position performs unexpectedly, Carnival 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 Carnival PLC will offset losses from the drop in Carnival PLC's long position.| Jupiter Fund vs. SupplyMe Capital PLC | Jupiter Fund vs. Lloyds Banking Group | Jupiter Fund vs. Premier African Minerals | Jupiter Fund vs. SANTANDER UK 8 |
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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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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