Correlation Between JPMorgan Chase and Mullen
Can any of the company-specific risk be diversified away by investing in both JPMorgan Chase and Mullen 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 Mullen 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 Mullen Group, you can compare the effects of market volatilities on JPMorgan Chase and Mullen 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 Mullen. Check out your portfolio center. Please also check ongoing floating volatility patterns of JPMorgan Chase and Mullen.
Diversification Opportunities for JPMorgan Chase and Mullen
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between JPMorgan and Mullen is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding JPMorgan Chase Co and Mullen Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mullen Group 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 Mullen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mullen Group has no effect on the direction of JPMorgan Chase i.e., JPMorgan Chase and Mullen go up and down completely randomly.
Pair Corralation between JPMorgan Chase and Mullen
Assuming the 90 days trading horizon JPMorgan Chase Co is expected to generate 0.94 times more return on investment than Mullen. However, JPMorgan Chase Co is 1.07 times less risky than Mullen. It trades about 0.1 of its potential returns per unit of risk. Mullen Group is currently generating about 0.03 per unit of risk. If you would invest 1,851 in JPMorgan Chase Co on August 27, 2024 and sell it today you would earn a total of 1,460 from holding JPMorgan Chase Co or generate 78.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
JPMorgan Chase Co vs. Mullen Group
Performance |
| Timeline |
| JPMorgan Chase |
| Mullen Group |
JPMorgan Chase and Mullen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JPMorgan Chase and Mullen
The main advantage of trading using opposite JPMorgan Chase and Mullen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JPMorgan Chase position performs unexpectedly, Mullen 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 Mullen will offset losses from the drop in Mullen'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 |
| Mullen vs. Pason Systems | Mullen vs. Westshore Terminals Investment | Mullen vs. Superior Plus Corp | Mullen vs. Gibson Energy |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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