Correlation Between JetBlue Airways and Virtus Global

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

Diversification Opportunities for JetBlue Airways and Virtus Global

-0.73

Correlation Coefficient

JetBlue Airways  Virtus Global

Pay attention - limited upside

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

Pair Corralation between JetBlue Airways and Virtus Global

Given the investment horizon of 90 days JetBlue Airways Corp is expected to under-perform the Virtus Global. In addition to that, JetBlue Airways is 2.62 times more volatile than Virtus Global Infrastructure. It trades about 0.0 of its total potential returns per unit of risk. Virtus Global Infrastructure is currently generating about 0.15 per unit of volatility. If you would invest  1,408  in Virtus Global Infrastructure on October 23, 2024 and sell it today you would earn a total of  33.00  from holding Virtus Global Infrastructure or generate 2.34% return on investment over 90 days.

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

JetBlue Airways Corp  vs.  Virtus Global Infrastructure

JetBlue Airways Corp

Risk-Adjusted Performance

3 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in JetBlue Airways Corp are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady essential indicators, JetBlue Airways may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Virtus Global Infras

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Virtus Global Infrastructure has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Virtus Global is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with JetBlue Airways and Virtus Global

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

The idea behind JetBlue Airways Corp and Virtus Global Infrastructure 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.