Correlation Between JPMorgan Active and IShares
Can any of the company-specific risk be diversified away by investing in both JPMorgan Active and IShares 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 JPMorgan Active and IShares into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JPMorgan Active Value and IShares, you can compare the effects of market volatilities on JPMorgan Active and IShares 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 JPMorgan Active with a short position of IShares. Check out your portfolio center. Please also check ongoing floating volatility patterns of JPMorgan Active and IShares.
Diversification Opportunities for JPMorgan Active and IShares
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between JPMorgan and IShares is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding JPMorgan Active Value and IShares in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IShares and JPMorgan Active 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 JPMorgan Active Value are associated (or correlated) with IShares. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IShares has no effect on the direction of JPMorgan Active i.e., JPMorgan Active and IShares go up and down completely randomly.
Pair Corralation between JPMorgan Active and IShares
Given the investment horizon of 90 days JPMorgan Active Value is expected to generate 0.75 times more return on investment than IShares. However, JPMorgan Active Value is 1.33 times less risky than IShares. It trades about 0.17 of its potential returns per unit of risk. IShares is currently generating about -0.09 per unit of risk. If you would invest 5,898 in JPMorgan Active Value on September 3, 2024 and sell it today you would earn a total of 927.00 from holding JPMorgan Active Value or generate 15.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 38.4% |
| Values | Daily Returns |
JPMorgan Active Value vs. IShares
Performance |
| Timeline |
| JPMorgan Active Value |
| IShares |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
JPMorgan Active and IShares Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JPMorgan Active and IShares
The main advantage of trading using opposite JPMorgan Active and IShares positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JPMorgan Active position performs unexpectedly, IShares 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 IShares will offset losses from the drop in IShares' long position.| JPMorgan Active vs. Global X Funds | JPMorgan Active vs. Dell Technologies | JPMorgan Active vs. Juniper Networks | JPMorgan Active vs. HUMANA INC |
| IShares vs. SmartETFs Asia Pacific | IShares vs. Listed Funds Trust | IShares vs. iShares AsiaPacific Dividend | IShares vs. ProShares MSCI Emerging |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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