Correlation Between JetBlue Airways and Marstons PLC

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

Diversification Opportunities for JetBlue Airways and Marstons PLC

-0.46

Correlation Coefficient

JetBlue Airways  Marstons PLC

Very good diversification

The 3 months correlation between JetBlue and Marstons is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding JetBlue Airways Corp and Marstons PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marstons PLC 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 Marstons PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marstons PLC has no effect on the direction of JetBlue Airways i.e., JetBlue Airways and Marstons PLC go up and down completely randomly.

Pair Corralation between JetBlue Airways and Marstons PLC

Given the investment horizon of 90 days JetBlue Airways Corp is expected to under-perform the Marstons PLC. In addition to that, JetBlue Airways is 1.46 times more volatile than Marstons PLC. It trades about -0.09 of its total potential returns per unit of risk. Marstons PLC is currently generating about 0.03 per unit of volatility. If you would invest  428.00  in Marstons PLC on December 22, 2024 and sell it today you would earn a total of  15.00  from holding Marstons PLC or generate 3.5% return on investment over 90 days.

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

JetBlue Airways Corp  vs.  Marstons PLC

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.

Marstons PLC

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Marstons PLC are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, Marstons PLC may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with JetBlue Airways and Marstons PLC

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

The idea behind JetBlue Airways Corp and Marstons PLC 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.