Correlation Between JPMF Global and Templeton Global
Can any of the company-specific risk be diversified away by investing in both JPMF Global and Templeton Global 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 JPMF Global and Templeton Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JPMF Global Natural and Templeton Global AD, you can compare the effects of market volatilities on JPMF Global and Templeton Global 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 JPMF Global with a short position of Templeton Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of JPMF Global and Templeton Global.
Diversification Opportunities for JPMF Global and Templeton Global
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between JPMF and Templeton is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding JPMF Global Natural and Templeton Global AD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Templeton Global and JPMF 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 JPMF Global Natural are associated (or correlated) with Templeton Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Templeton Global has no effect on the direction of JPMF Global i.e., JPMF Global and Templeton Global go up and down completely randomly.
Pair Corralation between JPMF Global and Templeton Global
Assuming the 90 days trading horizon JPMF Global Natural is expected to generate 1.1 times more return on investment than Templeton Global. However, JPMF Global is 1.1 times more volatile than Templeton Global AD. It trades about 0.04 of its potential returns per unit of risk. Templeton Global AD is currently generating about 0.02 per unit of risk. If you would invest 1,200 in JPMF Global Natural on September 14, 2024 and sell it today you would earn a total of 114.00 from holding JPMF Global Natural or generate 9.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.05% |
| Values | Daily Returns |
JPMF Global Natural vs. Templeton Global AD
Performance |
| Timeline |
| JPMF Global Natural |
| Templeton Global |
JPMF Global and Templeton Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JPMF Global and Templeton Global
The main advantage of trading using opposite JPMF Global and Templeton Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JPMF Global position performs unexpectedly, Templeton Global 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 Templeton Global will offset losses from the drop in Templeton Global's long position.| JPMF Global vs. Groupama Entreprises N | JPMF Global vs. Renaissance Europe C | JPMF Global vs. Superior Plus Corp | JPMF Global vs. Origin Agritech |
| Templeton Global vs. Groupama Entreprises N | Templeton Global vs. Renaissance Europe C | Templeton Global vs. Superior Plus Corp | Templeton Global vs. Origin Agritech |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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