Correlation Between Jupiter Wellness and HHG Capital

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

By analyzing existing cross correlation between Jupiter Wellness Acquisition and HHG Capital Corp, you can compare the effects of market volatilities on Jupiter Wellness and HHG Capital 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 Wellness with a short position of HHG Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jupiter Wellness and HHG Capital.

Diversification Opportunities for Jupiter Wellness and HHG Capital

0.22

Correlation Coefficient

Jupiter Wellness  HHG Capital

Modest diversification

The 3 months correlation between Jupiter and HHG is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Jupiter Wellness Acquisition and HHG Capital Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HHG Capital Corp and Jupiter Wellness 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 Wellness Acquisition are associated (or correlated) with HHG Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HHG Capital Corp has no effect on the direction of Jupiter Wellness i.e., Jupiter Wellness and HHG Capital go up and down completely randomly.

Pair Corralation between Jupiter Wellness and HHG Capital

Given the investment horizon of 90 days Jupiter Wellness Acquisition is expected to generate 6.79 times more return on investment than HHG Capital. However, Jupiter Wellness is 6.79 times more volatile than HHG Capital Corp. It trades about 0.01 of its potential returns per unit of risk. HHG Capital Corp is currently generating about 0.02 per unit of risk. If you would invest  1,012  in Jupiter Wellness Acquisition on September 18, 2024 and sell it today you would lose (447.00) from holding Jupiter Wellness Acquisition or give up 44.17% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	24.38%
Values	Daily Returns

Jupiter Wellness Acquisition  vs.  HHG Capital Corp

Jupiter Wellness Acq

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Jupiter Wellness Acquisition has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Jupiter Wellness is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

HHG Capital Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days HHG Capital Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of conflicting performance in the last few months, the Stock's technical and fundamental indicators remain rather sound which may send shares a bit higher in January 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Pair Trading with Jupiter Wellness and HHG Capital

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

The idea behind Jupiter Wellness Acquisition and HHG Capital Corp 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.