Correlation Between JPMorgan Chase and Great West
Can any of the company-specific risk be diversified away by investing in both JPMorgan Chase and Great West 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 Great West 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 Great West Lifeco, you can compare the effects of market volatilities on JPMorgan Chase and Great West 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 Great West. Check out your portfolio center. Please also check ongoing floating volatility patterns of JPMorgan Chase and Great West.
Diversification Opportunities for JPMorgan Chase and Great West
-0.81 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between JPMorgan and Great is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding JPMorgan Chase Co and Great West Lifeco in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Great West Lifeco 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 Great West. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Great West Lifeco has no effect on the direction of JPMorgan Chase i.e., JPMorgan Chase and Great West go up and down completely randomly.
Pair Corralation between JPMorgan Chase and Great West
Assuming the 90 days trading horizon JPMorgan Chase Co is expected to generate 1.82 times more return on investment than Great West. However, JPMorgan Chase is 1.82 times more volatile than Great West Lifeco. It trades about 0.1 of its potential returns per unit of risk. Great West Lifeco is currently generating about 0.05 per unit of risk. If you would invest 1,746 in JPMorgan Chase Co on September 3, 2024 and sell it today you would earn a total of 1,598 from holding JPMorgan Chase Co or generate 91.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
JPMorgan Chase Co vs. Great West Lifeco
Performance |
| Timeline |
| JPMorgan Chase |
| Great West Lifeco |
JPMorgan Chase and Great West Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JPMorgan Chase and Great West
The main advantage of trading using opposite JPMorgan Chase and Great West positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JPMorgan Chase position performs unexpectedly, Great West 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 Great West will offset losses from the drop in Great West's long position.| JPMorgan Chase vs. Intact Financial Corp | JPMorgan Chase vs. Primaris Retail RE | JPMorgan Chase vs. Plaza Retail REIT | JPMorgan Chase vs. Financial 15 Split |
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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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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