Correlation Between The Hartford and Jpmorgan Emerging
Can any of the company-specific risk be diversified away by investing in both The Hartford 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 The Hartford and Jpmorgan Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Hartford Emerging and Jpmorgan Emerging Markets, you can compare the effects of market volatilities on The Hartford 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 The Hartford with a short position of Jpmorgan Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of The Hartford and Jpmorgan Emerging.
Diversification Opportunities for The Hartford and Jpmorgan Emerging
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between THE and JPMORGAN is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding The Hartford Emerging 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 The Hartford 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 The Hartford Emerging 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 The Hartford i.e., The Hartford and Jpmorgan Emerging go up and down completely randomly.
Pair Corralation between The Hartford and Jpmorgan Emerging
Assuming the 90 days horizon The Hartford Emerging is expected to generate 0.49 times more return on investment than Jpmorgan Emerging. However, The Hartford Emerging is 2.03 times less risky than Jpmorgan Emerging. It trades about 0.06 of its potential returns per unit of risk. Jpmorgan Emerging Markets is currently generating about 0.02 per unit of risk. If you would invest 381.00 in The Hartford Emerging on September 3, 2024 and sell it today you would earn a total of 51.00 from holding The Hartford Emerging or generate 13.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Hartford Emerging vs. Jpmorgan Emerging Markets
Performance |
| Timeline |
| Hartford Emerging |
| Jpmorgan Emerging Markets |
The Hartford and Jpmorgan Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with The Hartford and Jpmorgan Emerging
The main advantage of trading using opposite The Hartford and Jpmorgan Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if The Hartford 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.| The Hartford vs. HUMANA INC | The Hartford vs. Aquagold International | The Hartford vs. Barloworld Ltd ADR | The Hartford vs. Morningstar Unconstrained Allocation |
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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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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