Correlation Between JPMorgan Equity and ISharesGlobal 100
Can any of the company-specific risk be diversified away by investing in both JPMorgan Equity and ISharesGlobal 100 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 Equity and ISharesGlobal 100 into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JPMorgan Equity Premium and iSharesGlobal 100, you can compare the effects of market volatilities on JPMorgan Equity and ISharesGlobal 100 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 Equity with a short position of ISharesGlobal 100. Check out your portfolio center. Please also check ongoing floating volatility patterns of JPMorgan Equity and ISharesGlobal 100.
Diversification Opportunities for JPMorgan Equity and ISharesGlobal 100
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between JPMorgan and ISharesGlobal is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding JPMorgan Equity Premium and iSharesGlobal 100 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iSharesGlobal 100 and JPMorgan Equity 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 Equity Premium are associated (or correlated) with ISharesGlobal 100. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iSharesGlobal 100 has no effect on the direction of JPMorgan Equity i.e., JPMorgan Equity and ISharesGlobal 100 go up and down completely randomly.
Pair Corralation between JPMorgan Equity and ISharesGlobal 100
Assuming the 90 days trading horizon JPMorgan Equity Premium is expected to under-perform the ISharesGlobal 100. In addition to that, JPMorgan Equity is 1.01 times more volatile than iSharesGlobal 100. It trades about -0.2 of its total potential returns per unit of risk. iSharesGlobal 100 is currently generating about 0.13 per unit of volatility. If you would invest 15,876 in iSharesGlobal 100 on October 13, 2024 and sell it today you would earn a total of 325.00 from holding iSharesGlobal 100 or generate 2.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.0% |
| Values | Daily Returns |
JPMorgan Equity Premium vs. iSharesGlobal 100
Performance |
| Timeline |
| JPMorgan Equity Premium |
| iSharesGlobal 100 |
JPMorgan Equity and ISharesGlobal 100 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JPMorgan Equity and ISharesGlobal 100
The main advantage of trading using opposite JPMorgan Equity and ISharesGlobal 100 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JPMorgan Equity position performs unexpectedly, ISharesGlobal 100 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 ISharesGlobal 100 will offset losses from the drop in ISharesGlobal 100's long position.| JPMorgan Equity vs. JPMorgan Global Research | JPMorgan Equity vs. JPMorgan 100Q Equity | JPMorgan Equity vs. JPMorgan 100Q Equity | JPMorgan Equity vs. JPMorgan Global Equity |
| ISharesGlobal 100 vs. iShares MSCI Emerging | ISharesGlobal 100 vs. Global X Hydrogen | ISharesGlobal 100 vs. Janus Henderson Sustainable | ISharesGlobal 100 vs. JPMorgan Equity Premium |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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