Correlation Between JPMorgan Core and HCM Defender
Can any of the company-specific risk be diversified away by investing in both JPMorgan Core and HCM Defender 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 Core and HCM Defender into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JPMorgan Core Plus and HCM Defender 500, you can compare the effects of market volatilities on JPMorgan Core and HCM Defender 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 Core with a short position of HCM Defender. Check out your portfolio center. Please also check ongoing floating volatility patterns of JPMorgan Core and HCM Defender.
Diversification Opportunities for JPMorgan Core and HCM Defender
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between JPMorgan and HCM is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding JPMorgan Core Plus and HCM Defender 500 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HCM Defender 500 and JPMorgan Core 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 Core Plus are associated (or correlated) with HCM Defender. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HCM Defender 500 has no effect on the direction of JPMorgan Core i.e., JPMorgan Core and HCM Defender go up and down completely randomly.
Pair Corralation between JPMorgan Core and HCM Defender
Given the investment horizon of 90 days JPMorgan Core Plus is expected to generate 0.32 times more return on investment than HCM Defender. However, JPMorgan Core Plus is 3.12 times less risky than HCM Defender. It trades about 0.27 of its potential returns per unit of risk. HCM Defender 500 is currently generating about -0.07 per unit of risk. If you would invest 4,621 in JPMorgan Core Plus on November 28, 2024 and sell it today you would earn a total of 78.00 from holding JPMorgan Core Plus or generate 1.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
JPMorgan Core Plus vs. HCM Defender 500
Performance |
| Timeline |
| JPMorgan Core Plus |
| HCM Defender 500 |
JPMorgan Core and HCM Defender Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JPMorgan Core and HCM Defender
The main advantage of trading using opposite JPMorgan Core and HCM Defender positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JPMorgan Core position performs unexpectedly, HCM Defender 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 HCM Defender will offset losses from the drop in HCM Defender's long position.| JPMorgan Core vs. JPMorgan BetaBuilders International | JPMorgan Core vs. JPMorgan BetaBuilders Equity | JPMorgan Core vs. JPMorgan Emerging Markets | JPMorgan Core vs. JPMorgan BetaBuilders Canada |
| HCM Defender vs. HCM Defender 100 | HCM Defender vs. Overlay Shares Large | HCM Defender vs. VanEck LongFlat Trend | HCM Defender vs. LeaderSharesTM AlphaFactor Core |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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