Correlation Between JPMorgan Chase and Leons Furniture
Can any of the company-specific risk be diversified away by investing in both JPMorgan Chase and Leons Furniture 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 Leons Furniture 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 Leons Furniture Limited, you can compare the effects of market volatilities on JPMorgan Chase and Leons Furniture 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 Leons Furniture. Check out your portfolio center. Please also check ongoing floating volatility patterns of JPMorgan Chase and Leons Furniture.
Diversification Opportunities for JPMorgan Chase and Leons Furniture
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between JPMorgan and Leons is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding JPMorgan Chase Co and Leons Furniture Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Leons Furniture 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 Leons Furniture. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Leons Furniture has no effect on the direction of JPMorgan Chase i.e., JPMorgan Chase and Leons Furniture go up and down completely randomly.
Pair Corralation between JPMorgan Chase and Leons Furniture
Assuming the 90 days trading horizon JPMorgan Chase Co is expected to generate 0.68 times more return on investment than Leons Furniture. However, JPMorgan Chase Co is 1.48 times less risky than Leons Furniture. It trades about 0.1 of its potential returns per unit of risk. Leons Furniture Limited is currently generating about 0.06 per unit of risk. If you would invest 1,710 in JPMorgan Chase Co on August 28, 2024 and sell it today you would earn a total of 1,622 from holding JPMorgan Chase Co or generate 94.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
JPMorgan Chase Co vs. Leons Furniture Limited
Performance |
| Timeline |
| JPMorgan Chase |
| Leons Furniture |
JPMorgan Chase and Leons Furniture Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JPMorgan Chase and Leons Furniture
The main advantage of trading using opposite JPMorgan Chase and Leons Furniture positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JPMorgan Chase position performs unexpectedly, Leons Furniture 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 Leons Furniture will offset losses from the drop in Leons Furniture's long position.| JPMorgan Chase vs. DelphX Capital Markets | JPMorgan Chase vs. Citadel Income | JPMorgan Chase vs. iShares Canadian HYBrid | JPMorgan Chase vs. Altagas Cum Red |
| Leons Furniture vs. High Liner Foods | Leons Furniture vs. Richelieu Hardware | Leons Furniture vs. North West | Leons Furniture vs. Toromont Industries |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
Other Complementary Tools
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio |