Correlation Between JPMorgan Chase and MTY Food
Can any of the company-specific risk be diversified away by investing in both JPMorgan Chase and MTY Food 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 MTY Food 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 MTY Food Group, you can compare the effects of market volatilities on JPMorgan Chase and MTY Food 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 MTY Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of JPMorgan Chase and MTY Food.
Diversification Opportunities for JPMorgan Chase and MTY Food
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between JPMorgan and MTY is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding JPMorgan Chase Co and MTY Food Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MTY Food 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 MTY Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MTY Food Group has no effect on the direction of JPMorgan Chase i.e., JPMorgan Chase and MTY Food go up and down completely randomly.
Pair Corralation between JPMorgan Chase and MTY Food
Assuming the 90 days trading horizon JPMorgan Chase Co is expected to generate 0.83 times more return on investment than MTY Food. However, JPMorgan Chase Co is 1.2 times less risky than MTY Food. It trades about 0.1 of its potential returns per unit of risk. MTY Food Group is currently generating about -0.01 per unit of risk. If you would invest 1,744 in JPMorgan Chase Co on September 2, 2024 and sell it today you would earn a total of 1,600 from holding JPMorgan Chase Co or generate 91.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
JPMorgan Chase Co vs. MTY Food Group
Performance |
| Timeline |
| JPMorgan Chase |
| MTY Food Group |
JPMorgan Chase and MTY Food Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JPMorgan Chase and MTY Food
The main advantage of trading using opposite JPMorgan Chase and MTY Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JPMorgan Chase position performs unexpectedly, MTY Food 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 MTY Food will offset losses from the drop in MTY Food's long position.| JPMorgan Chase vs. Toronto Dominion Bank | JPMorgan Chase vs. Royal Bank of | JPMorgan Chase vs. Bank of Montreal | JPMorgan Chase vs. Canadian Imperial Bank |
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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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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