Correlation Between Aim Investment and Jpmorgan Trust
Can any of the company-specific risk be diversified away by investing in both Aim Investment and Jpmorgan 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 Aim Investment and Jpmorgan Trust into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aim Investment Secs and Jpmorgan Trust I, you can compare the effects of market volatilities on Aim Investment and Jpmorgan 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 Aim Investment with a short position of Jpmorgan Trust. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aim Investment and Jpmorgan Trust.
Diversification Opportunities for Aim Investment and Jpmorgan Trust
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Aim and Jpmorgan is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Aim Investment Secs and Jpmorgan Trust I in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jpmorgan Trust I and Aim Investment 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 Aim Investment Secs are associated (or correlated) with Jpmorgan Trust. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jpmorgan Trust I has no effect on the direction of Aim Investment i.e., Aim Investment and Jpmorgan Trust go up and down completely randomly.
Pair Corralation between Aim Investment and Jpmorgan Trust
Assuming the 90 days horizon Aim Investment Secs is expected to generate 1.02 times more return on investment than Jpmorgan Trust. However, Aim Investment is 1.02 times more volatile than Jpmorgan Trust I. It trades about 0.13 of its potential returns per unit of risk. Jpmorgan Trust I is currently generating about 0.12 per unit of risk. If you would invest 99.00 in Aim Investment Secs on September 2, 2024 and sell it today you would earn a total of 1.00 from holding Aim Investment Secs or generate 1.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 96.97% |
| Values | Daily Returns |
Aim Investment Secs vs. Jpmorgan Trust I
Performance |
| Timeline |
| Aim Investment Secs |
| Jpmorgan Trust I |
Aim Investment and Jpmorgan Trust Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aim Investment and Jpmorgan Trust
The main advantage of trading using opposite Aim Investment and Jpmorgan Trust positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aim Investment position performs unexpectedly, Jpmorgan 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 Jpmorgan Trust will offset losses from the drop in Jpmorgan Trust's long position.| Aim Investment vs. Vanguard Total Stock | Aim Investment vs. Vanguard 500 Index | Aim Investment vs. Vanguard Total Stock | Aim Investment vs. Vanguard Total Stock |
| Jpmorgan Trust vs. Vanguard Total Stock | Jpmorgan Trust vs. Vanguard 500 Index | Jpmorgan Trust vs. Vanguard Total Stock | Jpmorgan Trust vs. Vanguard Total Stock |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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