Correlation Between JetBlue Airways and Garware Technical

Can any of the company-specific risk be diversified away by investing in both JetBlue Airways and Garware Technical 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 JetBlue Airways and Garware Technical into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between JetBlue Airways Corp and Garware Technical Fibres, you can compare the effects of market volatilities on JetBlue Airways and Garware Technical 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 JetBlue Airways with a short position of Garware Technical. Check out your portfolio center. Please also check ongoing floating volatility patterns of JetBlue Airways and Garware Technical.

Diversification Opportunities for JetBlue Airways and Garware Technical

0.28

Correlation Coefficient

JetBlue Airways  Garware Technical

Modest diversification

The 3 months correlation between JetBlue and Garware is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding JetBlue Airways Corp and Garware Technical Fibres in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Garware Technical Fibres and JetBlue Airways 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 JetBlue Airways Corp are associated (or correlated) with Garware Technical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Garware Technical Fibres has no effect on the direction of JetBlue Airways i.e., JetBlue Airways and Garware Technical go up and down completely randomly.

Pair Corralation between JetBlue Airways and Garware Technical

Given the investment horizon of 90 days JetBlue Airways Corp is expected to under-perform the Garware Technical. In addition to that, JetBlue Airways is 1.96 times more volatile than Garware Technical Fibres. It trades about -0.08 of its total potential returns per unit of risk. Garware Technical Fibres is currently generating about -0.03 per unit of volatility. If you would invest  89,400  in Garware Technical Fibres on December 26, 2024 and sell it today you would lose (5,725) from holding Garware Technical Fibres or give up 6.4% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.36%
Values	Daily Returns

JetBlue Airways Corp  vs.  Garware Technical Fibres

JetBlue Airways Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days JetBlue Airways Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's essential indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Garware Technical Fibres

Risk-Adjusted Performance

Very Weak

Over the last 90 days Garware Technical Fibres has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Garware Technical is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with JetBlue Airways and Garware Technical

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

The idea behind JetBlue Airways Corp and Garware Technical Fibres 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.