Correlation Between Hollywood Bowl and Jupiter Fund

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

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

Diversification Opportunities for Hollywood Bowl and Jupiter Fund

-0.27

Correlation Coefficient

Hollywood Bowl  Jupiter Fund

Very good diversification

The 3 months correlation between Hollywood and Jupiter is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Hollywood Bowl Group and Jupiter Fund Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jupiter Fund Management and Hollywood Bowl 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 Hollywood Bowl Group are associated (or correlated) with Jupiter Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jupiter Fund Management has no effect on the direction of Hollywood Bowl i.e., Hollywood Bowl and Jupiter Fund go up and down completely randomly.

Pair Corralation between Hollywood Bowl and Jupiter Fund

Assuming the 90 days trading horizon Hollywood Bowl Group is expected to under-perform the Jupiter Fund. In addition to that, Hollywood Bowl is 1.46 times more volatile than Jupiter Fund Management. It trades about -0.32 of its total potential returns per unit of risk. Jupiter Fund Management is currently generating about 0.07 per unit of volatility. If you would invest  8,450  in Jupiter Fund Management on October 12, 2024 and sell it today you would earn a total of  190.00  from holding Jupiter Fund Management or generate 2.25% return on investment over 90 days.

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

Hollywood Bowl Group  vs.  Jupiter Fund Management

Hollywood Bowl Group

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Hollywood Bowl Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Hollywood Bowl is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Jupiter Fund Management

Risk-Adjusted Performance

1 of 100

Very Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Jupiter Fund Management are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. 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.

Pair Trading with Hollywood Bowl and Jupiter Fund

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

The idea behind Hollywood Bowl Group and Jupiter Fund Management 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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.