Correlation Between SPARTAN STORES and Jupiter Fund

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

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

Diversification Opportunities for SPARTAN STORES and Jupiter Fund

0.37

Correlation Coefficient

SPARTAN STORES  Jupiter Fund

Weak diversification

The 3 months correlation between SPARTAN and Jupiter is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding SPARTAN STORES and Jupiter Fund Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jupiter Fund Management and SPARTAN STORES 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 SPARTAN STORES are associated (or correlated) with Jupiter Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jupiter Fund Management has no effect on the direction of SPARTAN STORES i.e., SPARTAN STORES and Jupiter Fund go up and down completely randomly.

Pair Corralation between SPARTAN STORES and Jupiter Fund

Assuming the 90 days trading horizon SPARTAN STORES is expected to generate 6.9 times less return on investment than Jupiter Fund. In addition to that, SPARTAN STORES is 1.32 times more volatile than Jupiter Fund Management. It trades about 0.01 of its total potential returns per unit of risk. Jupiter Fund Management is currently generating about 0.09 per unit of volatility. If you would invest  94.00  in Jupiter Fund Management on September 12, 2024 and sell it today you would earn a total of  9.00  from holding Jupiter Fund Management or generate 9.57% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.46%
Values	Daily Returns

SPARTAN STORES  vs.  Jupiter Fund Management

SPARTAN STORES

Risk-Adjusted Performance

0 of 100

Very Weak

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

Jupiter Fund Management

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Jupiter Fund Management are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Jupiter Fund may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with SPARTAN STORES and Jupiter Fund

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

The idea behind SPARTAN STORES and Jupiter Fund Management 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.