Correlation Between FF Global and JPMF Global
Can any of the company-specific risk be diversified away by investing in both FF Global and JPMF Global 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 FF Global and JPMF Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FF Global and JPMF Global Natural, you can compare the effects of market volatilities on FF Global and JPMF Global 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 FF Global with a short position of JPMF Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of FF Global and JPMF Global.
Diversification Opportunities for FF Global and JPMF Global
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between FJ2P and JPMF is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding FF Global and JPMF Global Natural in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JPMF Global Natural and FF Global 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 FF Global are associated (or correlated) with JPMF Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JPMF Global Natural has no effect on the direction of FF Global i.e., FF Global and JPMF Global go up and down completely randomly.
Pair Corralation between FF Global and JPMF Global
Assuming the 90 days trading horizon FF Global is expected to generate 1.29 times more return on investment than JPMF Global. However, FF Global is 1.29 times more volatile than JPMF Global Natural. It trades about 0.07 of its potential returns per unit of risk. JPMF Global Natural is currently generating about 0.04 per unit of risk. If you would invest 6,253 in FF Global on September 14, 2024 and sell it today you would earn a total of 1,265 from holding FF Global or generate 20.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
FF Global vs. JPMF Global Natural
Performance |
| Timeline |
| FF Global |
| JPMF Global Natural |
FF Global and JPMF Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FF Global and JPMF Global
The main advantage of trading using opposite FF Global and JPMF Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FF Global position performs unexpectedly, JPMF Global 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 JPMF Global will offset losses from the drop in JPMF Global's long position.| FF Global vs. Azvalor Global Value | FF Global vs. JPM Global Natural | FF Global vs. Cobas Global PP | FF Global vs. Aberdeen Global Asian |
| JPMF Global vs. Groupama Entreprises N | JPMF Global vs. Renaissance Europe C | JPMF Global vs. Superior Plus Corp | JPMF Global vs. Origin Agritech |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
Other Complementary Tools
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum |