Correlation Between JPMorgan Chase and FPX Nickel
Can any of the company-specific risk be diversified away by investing in both JPMorgan Chase and FPX Nickel 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 Chase and FPX Nickel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JPMorgan Chase Co and FPX Nickel Corp, you can compare the effects of market volatilities on JPMorgan Chase and FPX Nickel 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 Chase with a short position of FPX Nickel. Check out your portfolio center. Please also check ongoing floating volatility patterns of JPMorgan Chase and FPX Nickel.
Diversification Opportunities for JPMorgan Chase and FPX Nickel
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between JPMorgan and FPX is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding JPMorgan Chase Co and FPX Nickel Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FPX Nickel Corp and JPMorgan Chase 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 Chase Co are associated (or correlated) with FPX Nickel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FPX Nickel Corp has no effect on the direction of JPMorgan Chase i.e., JPMorgan Chase and FPX Nickel go up and down completely randomly.
Pair Corralation between JPMorgan Chase and FPX Nickel
Assuming the 90 days trading horizon JPMorgan Chase Co is expected to generate 0.31 times more return on investment than FPX Nickel. However, JPMorgan Chase Co is 3.21 times less risky than FPX Nickel. It trades about 0.13 of its potential returns per unit of risk. FPX Nickel Corp is currently generating about -0.01 per unit of risk. If you would invest 1,759 in JPMorgan Chase Co on August 26, 2024 and sell it today you would earn a total of 1,552 from holding JPMorgan Chase Co or generate 88.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
JPMorgan Chase Co vs. FPX Nickel Corp
Performance |
| Timeline |
| JPMorgan Chase |
| FPX Nickel Corp |
JPMorgan Chase and FPX Nickel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JPMorgan Chase and FPX Nickel
The main advantage of trading using opposite JPMorgan Chase and FPX Nickel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JPMorgan Chase position performs unexpectedly, FPX Nickel 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 FPX Nickel will offset losses from the drop in FPX Nickel's long position.| JPMorgan Chase vs. iShares Canadian HYBrid | JPMorgan Chase vs. Altagas Cum Red | JPMorgan Chase vs. European Residential Real | JPMorgan Chase vs. RBC Discount Bond |
| FPX Nickel vs. First Majestic Silver | FPX Nickel vs. Ivanhoe Energy | FPX Nickel vs. Orezone Gold Corp | FPX Nickel vs. Faraday Copper Corp |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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