Correlation Between JPMorgan Global and Ebro Foods
Can any of the company-specific risk be diversified away by investing in both JPMorgan Global and Ebro Foods 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 Global and Ebro Foods into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JPMorgan Global Emerging and Ebro Foods, you can compare the effects of market volatilities on JPMorgan Global and Ebro Foods 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 Global with a short position of Ebro Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of JPMorgan Global and Ebro Foods.
Diversification Opportunities for JPMorgan Global and Ebro Foods
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between JPMorgan and Ebro is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding JPMorgan Global Emerging and Ebro Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ebro Foods and JPMorgan Global 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 Global Emerging are associated (or correlated) with Ebro Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ebro Foods has no effect on the direction of JPMorgan Global i.e., JPMorgan Global and Ebro Foods go up and down completely randomly.
Pair Corralation between JPMorgan Global and Ebro Foods
Assuming the 90 days trading horizon JPMorgan Global Emerging is expected to generate 2.04 times more return on investment than Ebro Foods. However, JPMorgan Global is 2.04 times more volatile than Ebro Foods. It trades about 0.02 of its potential returns per unit of risk. Ebro Foods is currently generating about -0.1 per unit of risk. If you would invest 13,300 in JPMorgan Global Emerging on September 13, 2024 and sell it today you would earn a total of 50.00 from holding JPMorgan Global Emerging or generate 0.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
JPMorgan Global Emerging vs. Ebro Foods
Performance |
| Timeline |
| JPMorgan Global Emerging |
| Ebro Foods |
JPMorgan Global and Ebro Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JPMorgan Global and Ebro Foods
The main advantage of trading using opposite JPMorgan Global and Ebro Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JPMorgan Global position performs unexpectedly, Ebro Foods 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 Ebro Foods will offset losses from the drop in Ebro Foods' long position.| JPMorgan Global vs. Roper Technologies | JPMorgan Global vs. Concurrent Technologies Plc | JPMorgan Global vs. METALL ZUG AG | JPMorgan Global vs. L3Harris Technologies |
| Ebro Foods vs. One Media iP | Ebro Foods vs. Catena Media PLC | Ebro Foods vs. Iron Mountain | Ebro Foods vs. Prosiebensat 1 Media |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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