Correlation Between Baird Small/mid and Jpmorgan Strategic
Can any of the company-specific risk be diversified away by investing in both Baird Small/mid and Jpmorgan Strategic 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 Baird Small/mid and Jpmorgan Strategic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Baird Smallmid Cap and Jpmorgan Strategic Income, you can compare the effects of market volatilities on Baird Small/mid and Jpmorgan Strategic 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 Baird Small/mid with a short position of Jpmorgan Strategic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baird Small/mid and Jpmorgan Strategic.
Diversification Opportunities for Baird Small/mid and Jpmorgan Strategic
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Baird and Jpmorgan is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Baird Smallmid Cap and Jpmorgan Strategic Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jpmorgan Strategic Income and Baird Small/mid 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 Baird Smallmid Cap are associated (or correlated) with Jpmorgan Strategic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jpmorgan Strategic Income has no effect on the direction of Baird Small/mid i.e., Baird Small/mid and Jpmorgan Strategic go up and down completely randomly.
Pair Corralation between Baird Small/mid and Jpmorgan Strategic
Assuming the 90 days horizon Baird Smallmid Cap is expected to generate 16.91 times more return on investment than Jpmorgan Strategic. However, Baird Small/mid is 16.91 times more volatile than Jpmorgan Strategic Income. It trades about 0.1 of its potential returns per unit of risk. Jpmorgan Strategic Income is currently generating about 0.3 per unit of risk. If you would invest 1,391 in Baird Smallmid Cap on September 1, 2024 and sell it today you would earn a total of 404.00 from holding Baird Smallmid Cap or generate 29.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Baird Smallmid Cap vs. Jpmorgan Strategic Income
Performance |
| Timeline |
| Baird Smallmid Cap |
| Jpmorgan Strategic Income |
Baird Small/mid and Jpmorgan Strategic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baird Small/mid and Jpmorgan Strategic
The main advantage of trading using opposite Baird Small/mid and Jpmorgan Strategic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baird Small/mid position performs unexpectedly, Jpmorgan Strategic 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 Strategic will offset losses from the drop in Jpmorgan Strategic's long position.| Baird Small/mid vs. Baird Aggregate Bond | Baird Small/mid vs. Baird Aggregate Bond | Baird Small/mid vs. Baird Short Term Bond | Baird Small/mid vs. Baird Short Term Bond |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
Other Complementary Tools
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets |