Correlation Between Jupiter Fund and Alior Bank

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

Diversification Opportunities for Jupiter Fund and Alior Bank

0.0

Correlation Coefficient

Jupiter Fund  Alior Bank

Pay attention - limited upside

The 3 months correlation between Jupiter and Alior is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Jupiter Fund Management and Alior Bank SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alior Bank SA 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 Alior Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alior Bank SA has no effect on the direction of Jupiter Fund i.e., Jupiter Fund and Alior Bank go up and down completely randomly.

Pair Corralation between Jupiter Fund and Alior Bank

Assuming the 90 days trading horizon Jupiter Fund Management is expected to under-perform the Alior Bank. But the stock apears to be less risky and, when comparing its historical volatility, Jupiter Fund Management is 3.02 times less risky than Alior Bank. The stock trades about -0.02 of its potential returns per unit of risk. The Alior Bank SA is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  7,950  in Alior Bank SA on September 27, 2024 and sell it today you would earn a total of  0.00  from holding Alior Bank SA or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Jupiter Fund Management  vs.  Alior Bank SA

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. In spite of rather sound technical and fundamental indicators, Jupiter Fund is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

Alior Bank SA

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Alior Bank SA are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Alior Bank is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Jupiter Fund and Alior Bank

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

The idea behind Jupiter Fund Management and Alior Bank SA 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.

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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.