Correlation Between Betmakers Technology and Jupiter Energy

Can any of the company-specific risk be diversified away by investing in both Betmakers Technology and Jupiter Energy 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 Betmakers Technology and Jupiter Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Betmakers Technology Group and Jupiter Energy, you can compare the effects of market volatilities on Betmakers Technology and Jupiter Energy 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 Betmakers Technology with a short position of Jupiter Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Betmakers Technology and Jupiter Energy.

Diversification Opportunities for Betmakers Technology and Jupiter Energy

0.73

Correlation Coefficient

Betmakers Technology  Jupiter Energy

Poor diversification

The 3 months correlation between Betmakers and Jupiter is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Betmakers Technology Group and Jupiter Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jupiter Energy and Betmakers Technology 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 Betmakers Technology Group are associated (or correlated) with Jupiter Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jupiter Energy has no effect on the direction of Betmakers Technology i.e., Betmakers Technology and Jupiter Energy go up and down completely randomly.

Pair Corralation between Betmakers Technology and Jupiter Energy

Assuming the 90 days trading horizon Betmakers Technology Group is expected to under-perform the Jupiter Energy. In addition to that, Betmakers Technology is 1.47 times more volatile than Jupiter Energy. It trades about -0.07 of its total potential returns per unit of risk. Jupiter Energy is currently generating about -0.04 per unit of volatility. If you would invest  3.10  in Jupiter Energy on October 7, 2024 and sell it today you would lose (0.10) from holding Jupiter Energy or give up 3.23% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Betmakers Technology Group  vs.  Jupiter Energy

Betmakers Technology

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Betmakers Technology Group are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Betmakers Technology unveiled solid returns over the last few months and may actually be approaching a breakup point.

Jupiter Energy

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Jupiter Energy are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Jupiter Energy unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Betmakers Technology and Jupiter Energy

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

The idea behind Betmakers Technology Group and Jupiter Energy 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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.