Correlation Between Stepan and Jupiter Marine

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

By analyzing existing cross correlation between Stepan Company and Jupiter Marine International, you can compare the effects of market volatilities on Stepan and Jupiter Marine 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 Stepan with a short position of Jupiter Marine. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stepan and Jupiter Marine.

Diversification Opportunities for Stepan and Jupiter Marine

0.0

Correlation Coefficient

Stepan  Jupiter Marine

Pay attention - limited upside

The 3 months correlation between Stepan and Jupiter is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Stepan Company and Jupiter Marine International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jupiter Marine Inter and Stepan 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 Stepan Company are associated (or correlated) with Jupiter Marine. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jupiter Marine Inter has no effect on the direction of Stepan i.e., Stepan and Jupiter Marine go up and down completely randomly.

Pair Corralation between Stepan and Jupiter Marine

If you would invest  0.01  in Jupiter Marine International on October 6, 2024 and sell it today you would earn a total of  0.00  from holding Jupiter Marine International or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	95.24%
Values	Daily Returns

Stepan Company  vs.  Jupiter Marine International

Stepan Company

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Stepan Company has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's fundamental indicators remain quite persistent which may send shares a bit higher in February 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Jupiter Marine Inter

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Jupiter Marine International has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong forward indicators, Jupiter Marine is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Stepan and Jupiter Marine

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

The idea behind Stepan Company and Jupiter Marine International 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.