Correlation Between Inspiration Healthcare and Jupiter Fund

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

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

Diversification Opportunities for Inspiration Healthcare and Jupiter Fund

0.65

Correlation Coefficient

Inspiration Healthcare  Jupiter Fund

Poor diversification

The 3 months correlation between Inspiration and Jupiter is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Inspiration Healthcare Group 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 Inspiration Healthcare 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 Inspiration Healthcare Group 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 Inspiration Healthcare i.e., Inspiration Healthcare and Jupiter Fund go up and down completely randomly.

Pair Corralation between Inspiration Healthcare and Jupiter Fund

Assuming the 90 days trading horizon Inspiration Healthcare is expected to generate 2.35 times less return on investment than Jupiter Fund. In addition to that, Inspiration Healthcare is 1.47 times more volatile than Jupiter Fund Management. It trades about 0.13 of its total potential returns per unit of risk. Jupiter Fund Management is currently generating about 0.46 per unit of volatility. If you would invest  7,040  in Jupiter Fund Management on April 22, 2025 and sell it today you would earn a total of  6,100  from holding Jupiter Fund Management or generate 86.65% return on investment over 90 days.

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

Inspiration Healthcare Group  vs.  Jupiter Fund Management

Inspiration Healthcare

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Inspiration Healthcare Group are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain technical and fundamental indicators, Inspiration Healthcare exhibited solid returns over the last few months and may actually be approaching a breakup point.

Jupiter Fund Management

Risk-Adjusted Performance

Very Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Jupiter Fund Management are ranked lower than 35 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain technical and fundamental indicators, Jupiter Fund exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Inspiration Healthcare and Jupiter Fund

The main advantage of trading using opposite Inspiration Healthcare and Jupiter Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Inspiration Healthcare 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 Inspiration Healthcare Group 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.