Correlation Between Jupiter Green and United Airlines

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

By analyzing existing cross correlation between Jupiter Green Investment and United Airlines Holdings, you can compare the effects of market volatilities on Jupiter Green and United Airlines 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 Jupiter Green with a short position of United Airlines. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jupiter Green and United Airlines.

Diversification Opportunities for Jupiter Green and United Airlines

0.61

Correlation Coefficient

Jupiter Green  United Airlines

Poor diversification

The 3 months correlation between Jupiter and United is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Jupiter Green Investment and United Airlines Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on United Airlines Holdings and Jupiter Green 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 Jupiter Green Investment are associated (or correlated) with United Airlines. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of United Airlines Holdings has no effect on the direction of Jupiter Green i.e., Jupiter Green and United Airlines go up and down completely randomly.

Pair Corralation between Jupiter Green and United Airlines

Assuming the 90 days trading horizon Jupiter Green Investment is expected to generate 0.37 times more return on investment than United Airlines. However, Jupiter Green Investment is 2.67 times less risky than United Airlines. It trades about 0.4 of its potential returns per unit of risk. United Airlines Holdings is currently generating about -0.12 per unit of risk. If you would invest  22,500  in Jupiter Green Investment on October 8, 2024 and sell it today you would earn a total of  900.00  from holding Jupiter Green Investment or generate 4.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	94.74%
Values	Daily Returns

Jupiter Green Investment  vs.  United Airlines Holdings

Jupiter Green Investment

Risk-Adjusted Performance

15 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Jupiter Green Investment are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound technical and fundamental indicators, Jupiter Green is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

United Airlines Holdings

Risk-Adjusted Performance

20 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in United Airlines Holdings are ranked lower than 20 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, United Airlines unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Jupiter Green and United Airlines

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

The idea behind Jupiter Green Investment and United Airlines Holdings 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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.