Correlation Between Hanover Insurance and JPMorgan Chase
Can any of the company-specific risk be diversified away by investing in both Hanover Insurance and JPMorgan Chase 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 Hanover Insurance and JPMorgan Chase into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Hanover Insurance and JPMorgan Chase Co, you can compare the effects of market volatilities on Hanover Insurance and JPMorgan Chase 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 Hanover Insurance with a short position of JPMorgan Chase. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hanover Insurance and JPMorgan Chase.
Diversification Opportunities for Hanover Insurance and JPMorgan Chase
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Hanover and JPMorgan is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding The Hanover Insurance and JPMorgan Chase Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JPMorgan Chase and Hanover Insurance 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 The Hanover Insurance are associated (or correlated) with JPMorgan Chase. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JPMorgan Chase has no effect on the direction of Hanover Insurance i.e., Hanover Insurance and JPMorgan Chase go up and down completely randomly.
Pair Corralation between Hanover Insurance and JPMorgan Chase
Assuming the 90 days horizon Hanover Insurance is expected to generate 2.78 times less return on investment than JPMorgan Chase. In addition to that, Hanover Insurance is 1.09 times more volatile than JPMorgan Chase Co. It trades about 0.04 of its total potential returns per unit of risk. JPMorgan Chase Co is currently generating about 0.11 per unit of volatility. If you would invest 11,554 in JPMorgan Chase Co on September 12, 2024 and sell it today you would earn a total of 11,586 from holding JPMorgan Chase Co or generate 100.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Hanover Insurance vs. JPMorgan Chase Co
Performance |
| Timeline |
| Hanover Insurance |
| JPMorgan Chase |
Hanover Insurance and JPMorgan Chase Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hanover Insurance and JPMorgan Chase
The main advantage of trading using opposite Hanover Insurance and JPMorgan Chase positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hanover Insurance position performs unexpectedly, JPMorgan Chase 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 Chase will offset losses from the drop in JPMorgan Chase's long position.| Hanover Insurance vs. The Peoples Insurance | Hanover Insurance vs. W R Berkley | Hanover Insurance vs. ZhongAn Online P |
| JPMorgan Chase vs. PSI Software AG | JPMorgan Chase vs. SANOK RUBBER ZY | JPMorgan Chase vs. Mitsubishi Materials | JPMorgan Chase vs. Check Point Software |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
Other Complementary Tools
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format |