Correlation Between Embark Commodity and Jpmorgan Emerging
Can any of the company-specific risk be diversified away by investing in both Embark Commodity and Jpmorgan Emerging 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 Embark Commodity and Jpmorgan Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Embark Commodity Strategy and Jpmorgan Emerging Markets, you can compare the effects of market volatilities on Embark Commodity and Jpmorgan Emerging 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 Embark Commodity with a short position of Jpmorgan Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Embark Commodity and Jpmorgan Emerging.
Diversification Opportunities for Embark Commodity and Jpmorgan Emerging
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Embark and Jpmorgan is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Embark Commodity Strategy and Jpmorgan Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jpmorgan Emerging Markets and Embark Commodity 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 Embark Commodity Strategy are associated (or correlated) with Jpmorgan Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jpmorgan Emerging Markets has no effect on the direction of Embark Commodity i.e., Embark Commodity and Jpmorgan Emerging go up and down completely randomly.
Pair Corralation between Embark Commodity and Jpmorgan Emerging
Assuming the 90 days horizon Embark Commodity is expected to generate 1.01 times less return on investment than Jpmorgan Emerging. In addition to that, Embark Commodity is 2.31 times more volatile than Jpmorgan Emerging Markets. It trades about 0.05 of its total potential returns per unit of risk. Jpmorgan Emerging Markets is currently generating about 0.12 per unit of volatility. If you would invest 557.00 in Jpmorgan Emerging Markets on November 5, 2024 and sell it today you would earn a total of 70.00 from holding Jpmorgan Emerging Markets or generate 12.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 89.2% |
| Values | Daily Returns |
Embark Commodity Strategy vs. Jpmorgan Emerging Markets
Performance |
| Timeline |
| Embark Commodity Strategy |
| Jpmorgan Emerging Markets |
Embark Commodity and Jpmorgan Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Embark Commodity and Jpmorgan Emerging
The main advantage of trading using opposite Embark Commodity and Jpmorgan Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Embark Commodity position performs unexpectedly, Jpmorgan Emerging 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 Emerging will offset losses from the drop in Jpmorgan Emerging's long position.| Embark Commodity vs. Aqr Diversified Arbitrage | Embark Commodity vs. Wilmington Diversified Income | Embark Commodity vs. Davenport Small Cap | Embark Commodity vs. Wells Fargo Diversified |
| Jpmorgan Emerging vs. Fdzbpx | Jpmorgan Emerging vs. Wmcanx | Jpmorgan Emerging vs. Rbb Fund | Jpmorgan Emerging vs. Fznopx |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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