Correlation Between Jupiter Fund and PARKEN Sport

Can any of the company-specific risk be diversified away by investing in both Jupiter Fund and PARKEN Sport 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 PARKEN Sport 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 PARKEN Sport Entertainment, you can compare the effects of market volatilities on Jupiter Fund and PARKEN Sport 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 PARKEN Sport. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jupiter Fund and PARKEN Sport.

Diversification Opportunities for Jupiter Fund and PARKEN Sport

-0.13

Correlation Coefficient

Jupiter Fund  PARKEN Sport

Good diversification

The 3 months correlation between Jupiter and PARKEN is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Jupiter Fund Management and PARKEN Sport Entertainment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PARKEN Sport Enterta 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 PARKEN Sport. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PARKEN Sport Enterta has no effect on the direction of Jupiter Fund i.e., Jupiter Fund and PARKEN Sport go up and down completely randomly.

Pair Corralation between Jupiter Fund and PARKEN Sport

Assuming the 90 days horizon Jupiter Fund Management is expected to under-perform the PARKEN Sport. But the stock apears to be less risky and, when comparing its historical volatility, Jupiter Fund Management is 2.25 times less risky than PARKEN Sport. The stock trades about -0.01 of its potential returns per unit of risk. The PARKEN Sport Entertainment is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  397.00  in PARKEN Sport Entertainment on September 21, 2024 and sell it today you would earn a total of  1,308  from holding PARKEN Sport Entertainment or generate 329.47% 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.  PARKEN Sport Entertainment

Jupiter Fund Management

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Jupiter Fund Management has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Jupiter Fund is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

PARKEN Sport Enterta

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in PARKEN Sport Entertainment are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, PARKEN Sport reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Jupiter Fund and PARKEN Sport

The main advantage of trading using opposite Jupiter Fund and PARKEN Sport positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jupiter Fund position performs unexpectedly, PARKEN Sport 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 PARKEN Sport will offset losses from the drop in PARKEN Sport's long position.

The idea behind Jupiter Fund Management and PARKEN Sport Entertainment pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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.