Correlation Between JPMorgan Chase and Lightspeed Commerce
Can any of the company-specific risk be diversified away by investing in both JPMorgan Chase and Lightspeed Commerce 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 Lightspeed Commerce 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 Lightspeed Commerce, you can compare the effects of market volatilities on JPMorgan Chase and Lightspeed Commerce 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 Lightspeed Commerce. Check out your portfolio center. Please also check ongoing floating volatility patterns of JPMorgan Chase and Lightspeed Commerce.
Diversification Opportunities for JPMorgan Chase and Lightspeed Commerce
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between JPMorgan and Lightspeed is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding JPMorgan Chase Co and Lightspeed Commerce in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lightspeed Commerce 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 Lightspeed Commerce. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lightspeed Commerce has no effect on the direction of JPMorgan Chase i.e., JPMorgan Chase and Lightspeed Commerce go up and down completely randomly.
Pair Corralation between JPMorgan Chase and Lightspeed Commerce
Assuming the 90 days trading horizon JPMorgan Chase Co is expected to generate 0.49 times more return on investment than Lightspeed Commerce. However, JPMorgan Chase Co is 2.04 times less risky than Lightspeed Commerce. It trades about 0.12 of its potential returns per unit of risk. Lightspeed Commerce is currently generating about 0.02 per unit of risk. If you would invest 2,299 in JPMorgan Chase Co on August 29, 2024 and sell it today you would earn a total of 1,032 from holding JPMorgan Chase Co or generate 44.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
JPMorgan Chase Co vs. Lightspeed Commerce
Performance |
| Timeline |
| JPMorgan Chase |
| Lightspeed Commerce |
JPMorgan Chase and Lightspeed Commerce Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JPMorgan Chase and Lightspeed Commerce
The main advantage of trading using opposite JPMorgan Chase and Lightspeed Commerce positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JPMorgan Chase position performs unexpectedly, Lightspeed Commerce 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 Lightspeed Commerce will offset losses from the drop in Lightspeed Commerce's long position.| JPMorgan Chase vs. Knight Therapeutics | JPMorgan Chase vs. DIRTT Environmental Solutions | JPMorgan Chase vs. Parkland Fuel | JPMorgan Chase vs. Pason Systems |
| Lightspeed Commerce vs. Shopify | Lightspeed Commerce vs. WELL Health Technologies | Lightspeed Commerce vs. BlackBerry | Lightspeed Commerce vs. Docebo Inc |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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