Correlation Between JPMorgan Active and Tema ETF
Can any of the company-specific risk be diversified away by investing in both JPMorgan Active and Tema ETF 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 Tema ETF 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 Tema ETF Trust, you can compare the effects of market volatilities on JPMorgan Active and Tema ETF 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 Tema ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of JPMorgan Active and Tema ETF.
Diversification Opportunities for JPMorgan Active and Tema ETF
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between JPMorgan and Tema is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding JPMorgan Active Value and Tema ETF Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tema ETF Trust 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 Tema ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tema ETF Trust has no effect on the direction of JPMorgan Active i.e., JPMorgan Active and Tema ETF go up and down completely randomly.
Pair Corralation between JPMorgan Active and Tema ETF
Given the investment horizon of 90 days JPMorgan Active is expected to generate 2.64 times less return on investment than Tema ETF. But when comparing it to its historical volatility, JPMorgan Active Value is 1.47 times less risky than Tema ETF. It trades about 0.33 of its potential returns per unit of risk. Tema ETF Trust is currently generating about 0.59 of returns per unit of risk over similar time horizon. If you would invest 2,156 in Tema ETF Trust on November 4, 2024 and sell it today you would earn a total of 246.00 from holding Tema ETF Trust or generate 11.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
JPMorgan Active Value vs. Tema ETF Trust
Performance |
| Timeline |
| JPMorgan Active Value |
| Tema ETF Trust |
JPMorgan Active and Tema ETF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JPMorgan Active and Tema ETF
The main advantage of trading using opposite JPMorgan Active and Tema ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JPMorgan Active position performs unexpectedly, Tema ETF 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 Tema ETF will offset losses from the drop in Tema ETF's long position.| JPMorgan Active vs. Global X Funds | JPMorgan Active vs. Dell Technologies | JPMorgan Active vs. Juniper Networks |
| Tema ETF vs. Smith Nephew SNATS | Tema ETF vs. Fresenius Medical Care | Tema ETF vs. Fomento Economico Mexicano | Tema ETF vs. The Cooper Companies, |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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