Correlation Between Sparebank and JPMorgan Global
Can any of the company-specific risk be diversified away by investing in both Sparebank and JPMorgan Global 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 Sparebank and JPMorgan Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sparebank 1 SR and JPMorgan Global Emerging, you can compare the effects of market volatilities on Sparebank and JPMorgan Global 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 Sparebank with a short position of JPMorgan Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sparebank and JPMorgan Global.
Diversification Opportunities for Sparebank and JPMorgan Global
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Sparebank and JPMorgan is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Sparebank 1 SR and JPMorgan Global Emerging in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JPMorgan Global Emerging and Sparebank 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 Sparebank 1 SR are associated (or correlated) with JPMorgan Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JPMorgan Global Emerging has no effect on the direction of Sparebank i.e., Sparebank and JPMorgan Global go up and down completely randomly.
Pair Corralation between Sparebank and JPMorgan Global
Assuming the 90 days trading horizon Sparebank 1 SR is expected to generate 1.48 times more return on investment than JPMorgan Global. However, Sparebank is 1.48 times more volatile than JPMorgan Global Emerging. It trades about 0.17 of its potential returns per unit of risk. JPMorgan Global Emerging is currently generating about 0.08 per unit of risk. If you would invest 14,130 in Sparebank 1 SR on September 16, 2024 and sell it today you would earn a total of 720.00 from holding Sparebank 1 SR or generate 5.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sparebank 1 SR vs. JPMorgan Global Emerging
Performance |
| Timeline |
| Sparebank 1 SR |
| JPMorgan Global Emerging |
Sparebank and JPMorgan Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sparebank and JPMorgan Global
The main advantage of trading using opposite Sparebank and JPMorgan Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sparebank position performs unexpectedly, JPMorgan Global 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 JPMorgan Global will offset losses from the drop in JPMorgan Global's long position.| Sparebank vs. Samsung Electronics Co | Sparebank vs. Samsung Electronics Co | Sparebank vs. Hyundai Motor | Sparebank vs. Reliance Industries Ltd |
| JPMorgan Global vs. Datalogic | JPMorgan Global vs. Sparebank 1 SR | JPMorgan Global vs. St Galler Kantonalbank | JPMorgan Global vs. Primary Health Properties |
Check out your portfolio center.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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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