Correlation Between JPMorgan and FlexShares Core
Can any of the company-specific risk be diversified away by investing in both JPMorgan and FlexShares Core 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 FlexShares Core into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JPMorgan and FlexShares Core Select, you can compare the effects of market volatilities on JPMorgan and FlexShares Core 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 FlexShares Core. Check out your portfolio center. Please also check ongoing floating volatility patterns of JPMorgan and FlexShares Core.
Diversification Opportunities for JPMorgan and FlexShares Core
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between JPMorgan and FlexShares is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding JPMorgan and FlexShares Core Select in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FlexShares Core Select 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 FlexShares Core. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FlexShares Core Select has no effect on the direction of JPMorgan i.e., JPMorgan and FlexShares Core go up and down completely randomly.
Pair Corralation between JPMorgan and FlexShares Core
Given the investment horizon of 90 days JPMorgan is expected to generate 0.44 times more return on investment than FlexShares Core. However, JPMorgan is 2.26 times less risky than FlexShares Core. It trades about 0.02 of its potential returns per unit of risk. FlexShares Core Select is currently generating about -0.06 per unit of risk. If you would invest 4,823 in JPMorgan on November 2, 2024 and sell it today you would earn a total of 4.00 from holding JPMorgan or generate 0.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 34.95% |
| Values | Daily Returns |
JPMorgan vs. FlexShares Core Select
Performance |
| Timeline |
| JPMorgan |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| FlexShares Core Select |
JPMorgan and FlexShares Core Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JPMorgan and FlexShares Core
The main advantage of trading using opposite JPMorgan and FlexShares Core positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JPMorgan position performs unexpectedly, FlexShares Core 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 FlexShares Core will offset losses from the drop in FlexShares Core's long position.| JPMorgan vs. JPMorgan Core Plus | JPMorgan vs. JPMorgan BetaBuilders International | JPMorgan vs. JPMorgan BetaBuilders Equity | JPMorgan vs. JPMorgan BetaBuilders Canada |
| FlexShares Core vs. iShares Yield Optimized | FlexShares Core vs. Invesco BulletShares 2027 | FlexShares Core vs. FlexShares Ready Access |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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