Correlation Between VanEck Intermediate and JPMorgan Municipal
Can any of the company-specific risk be diversified away by investing in both VanEck Intermediate and JPMorgan Municipal 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 VanEck Intermediate and JPMorgan Municipal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between VanEck Intermediate Muni and JPMorgan Municipal, you can compare the effects of market volatilities on VanEck Intermediate and JPMorgan Municipal 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 VanEck Intermediate with a short position of JPMorgan Municipal. Check out your portfolio center. Please also check ongoing floating volatility patterns of VanEck Intermediate and JPMorgan Municipal.
Diversification Opportunities for VanEck Intermediate and JPMorgan Municipal
0.98 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between VanEck and JPMorgan is 0.98. Overlapping area represents the amount of risk that can be diversified away by holding VanEck Intermediate Muni and JPMorgan Municipal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JPMorgan Municipal and VanEck Intermediate 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 VanEck Intermediate Muni are associated (or correlated) with JPMorgan Municipal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JPMorgan Municipal has no effect on the direction of VanEck Intermediate i.e., VanEck Intermediate and JPMorgan Municipal go up and down completely randomly.
Pair Corralation between VanEck Intermediate and JPMorgan Municipal
Considering the 90-day investment horizon VanEck Intermediate Muni is expected to generate 1.24 times more return on investment than JPMorgan Municipal. However, VanEck Intermediate is 1.24 times more volatile than JPMorgan Municipal. It trades about 0.06 of its potential returns per unit of risk. JPMorgan Municipal is currently generating about 0.07 per unit of risk. If you would invest 4,598 in VanEck Intermediate Muni on August 26, 2024 and sell it today you would earn a total of 21.00 from holding VanEck Intermediate Muni or generate 0.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
VanEck Intermediate Muni vs. JPMorgan Municipal
Performance |
| Timeline |
| VanEck Intermediate Muni |
| JPMorgan Municipal |
VanEck Intermediate and JPMorgan Municipal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with VanEck Intermediate and JPMorgan Municipal
The main advantage of trading using opposite VanEck Intermediate and JPMorgan Municipal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VanEck Intermediate position performs unexpectedly, JPMorgan Municipal 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 Municipal will offset losses from the drop in JPMorgan Municipal's long position.| VanEck Intermediate vs. BlackRock Intermediate Muni | VanEck Intermediate vs. SSGA Active Trust | VanEck Intermediate vs. SPDR MarketAxess Investment | VanEck Intermediate vs. SSGA Active Trust |
| JPMorgan Municipal vs. BlackRock Intermediate Muni | JPMorgan Municipal vs. SSGA Active Trust | JPMorgan Municipal vs. SPDR MarketAxess Investment | JPMorgan Municipal vs. SSGA Active Trust |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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