Correlation Between JP Morgan and IMGP DBi
Can any of the company-specific risk be diversified away by investing in both JP Morgan and IMGP DBi 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 JP Morgan and IMGP DBi into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JP Morgan Exchange Traded and iMGP DBi Managed, you can compare the effects of market volatilities on JP Morgan and IMGP DBi 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 JP Morgan with a short position of IMGP DBi. Check out your portfolio center. Please also check ongoing floating volatility patterns of JP Morgan and IMGP DBi.
Diversification Opportunities for JP Morgan and IMGP DBi
Poor diversification
The 3 months correlation between JDIV and IMGP is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding JP Morgan Exchange Traded and iMGP DBi Managed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iMGP DBi Managed and JP Morgan 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 JP Morgan Exchange Traded are associated (or correlated) with IMGP DBi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iMGP DBi Managed has no effect on the direction of JP Morgan i.e., JP Morgan and IMGP DBi go up and down completely randomly.
Pair Corralation between JP Morgan and IMGP DBi
Given the investment horizon of 90 days JP Morgan Exchange Traded is expected to under-perform the IMGP DBi. In addition to that, JP Morgan is 1.2 times more volatile than iMGP DBi Managed. It trades about -0.06 of its total potential returns per unit of risk. iMGP DBi Managed is currently generating about -0.05 per unit of volatility. If you would invest 2,761 in iMGP DBi Managed on September 3, 2024 and sell it today you would lose (40.00) from holding iMGP DBi Managed or give up 1.45% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 73.44% |
| Values | Daily Returns |
JP Morgan Exchange Traded vs. iMGP DBi Managed
Performance |
| Timeline |
| JP Morgan Exchange |
| iMGP DBi Managed |
JP Morgan and IMGP DBi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JP Morgan and IMGP DBi
The main advantage of trading using opposite JP Morgan and IMGP DBi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JP Morgan position performs unexpectedly, IMGP DBi 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 IMGP DBi will offset losses from the drop in IMGP DBi's long position.| JP Morgan vs. FT Vest Equity | JP Morgan vs. Zillow Group Class | JP Morgan vs. Northern Lights | JP Morgan vs. VanEck Vectors Moodys |
| IMGP DBi vs. KFA Mount Lucas | IMGP DBi vs. Simplify Exchange Traded | IMGP DBi vs. Simplify Interest Rate | IMGP DBi vs. First Trust Managed |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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