Correlation Between Grupo Hotelero and JPMorgan Chase
Can any of the company-specific risk be diversified away by investing in both Grupo Hotelero and JPMorgan Chase 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 Grupo Hotelero and JPMorgan Chase into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grupo Hotelero Santa and JPMorgan Chase Co, you can compare the effects of market volatilities on Grupo Hotelero and JPMorgan Chase 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 Grupo Hotelero with a short position of JPMorgan Chase. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grupo Hotelero and JPMorgan Chase.
Diversification Opportunities for Grupo Hotelero and JPMorgan Chase
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Grupo and JPMorgan is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Grupo Hotelero Santa and JPMorgan Chase Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JPMorgan Chase and Grupo Hotelero 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 Grupo Hotelero Santa are associated (or correlated) with JPMorgan Chase. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JPMorgan Chase has no effect on the direction of Grupo Hotelero i.e., Grupo Hotelero and JPMorgan Chase go up and down completely randomly.
Pair Corralation between Grupo Hotelero and JPMorgan Chase
Assuming the 90 days trading horizon Grupo Hotelero is expected to generate 6.24 times less return on investment than JPMorgan Chase. But when comparing it to its historical volatility, Grupo Hotelero Santa is 3.17 times less risky than JPMorgan Chase. It trades about 0.11 of its potential returns per unit of risk. JPMorgan Chase Co is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 450,000 in JPMorgan Chase Co on August 27, 2024 and sell it today you would earn a total of 58,900 from holding JPMorgan Chase Co or generate 13.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grupo Hotelero Santa vs. JPMorgan Chase Co
Performance |
| Timeline |
| Grupo Hotelero Santa |
| JPMorgan Chase |
Grupo Hotelero and JPMorgan Chase Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grupo Hotelero and JPMorgan Chase
The main advantage of trading using opposite Grupo Hotelero and JPMorgan Chase positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grupo Hotelero position performs unexpectedly, JPMorgan Chase 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 Chase will offset losses from the drop in JPMorgan Chase's long position.| Grupo Hotelero vs. McEwen Mining | Grupo Hotelero vs. Grupo Carso SAB | Grupo Hotelero vs. Grupo Sports World | Grupo Hotelero vs. Cognizant Technology Solutions |
| JPMorgan Chase vs. Grupo Hotelero Santa | JPMorgan Chase vs. United States Steel | JPMorgan Chase vs. Ross Stores | JPMorgan Chase vs. Cognizant Technology Solutions |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
Other Complementary Tools
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account |