Correlation Between JPMorgan and First Trust
Can any of the company-specific risk be diversified away by investing in both JPMorgan and First Trust 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 JPMorgan and First Trust into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JPMorgan and First Trust North, you can compare the effects of market volatilities on JPMorgan and First Trust 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 JPMorgan with a short position of First Trust. Check out your portfolio center. Please also check ongoing floating volatility patterns of JPMorgan and First Trust.
Diversification Opportunities for JPMorgan and First Trust
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between JPMorgan and First is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding JPMorgan and First Trust North in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Trust North and JPMorgan 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 JPMorgan are associated (or correlated) with First Trust. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Trust North has no effect on the direction of JPMorgan i.e., JPMorgan and First Trust go up and down completely randomly.
Pair Corralation between JPMorgan and First Trust
If you would invest 3,586 in First Trust North on November 3, 2024 and sell it today you would earn a total of 148.00 from holding First Trust North or generate 4.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 5.0% |
| Values | Daily Returns |
JPMorgan vs. First Trust North
Performance |
| Timeline |
| JPMorgan |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| First Trust North |
JPMorgan and First Trust Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JPMorgan and First Trust
The main advantage of trading using opposite JPMorgan and First Trust positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JPMorgan position performs unexpectedly, First Trust 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 First Trust will offset losses from the drop in First Trust's long position.| JPMorgan vs. Alerian MLP ETF | JPMorgan vs. WisdomTree Emerging Markets | JPMorgan vs. Global X MLP | JPMorgan vs. First Trust North |
| First Trust vs. Global X MLP | First Trust vs. Global X MLP | First Trust vs. First Trust Energy | First Trust vs. First Trust Preferred |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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