Correlation Between JPMorgan Chase and AIB Group
Can any of the company-specific risk be diversified away by investing in both JPMorgan Chase and AIB Group 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 AIB Group 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 AIB Group plc, you can compare the effects of market volatilities on JPMorgan Chase and AIB Group 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 AIB Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of JPMorgan Chase and AIB Group.
Diversification Opportunities for JPMorgan Chase and AIB Group
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between JPMorgan and AIB is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding JPMorgan Chase Co and AIB Group plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AIB Group plc 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 AIB Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AIB Group plc has no effect on the direction of JPMorgan Chase i.e., JPMorgan Chase and AIB Group go up and down completely randomly.
Pair Corralation between JPMorgan Chase and AIB Group
Considering the 90-day investment horizon JPMorgan Chase Co is expected to generate 0.68 times more return on investment than AIB Group. However, JPMorgan Chase Co is 1.47 times less risky than AIB Group. It trades about 0.09 of its potential returns per unit of risk. AIB Group plc is currently generating about 0.04 per unit of risk. If you would invest 19,618 in JPMorgan Chase Co on September 3, 2024 and sell it today you would earn a total of 5,354 from holding JPMorgan Chase Co or generate 27.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
JPMorgan Chase Co vs. AIB Group plc
Performance |
| Timeline |
| JPMorgan Chase |
| AIB Group plc |
JPMorgan Chase and AIB Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JPMorgan Chase and AIB Group
The main advantage of trading using opposite JPMorgan Chase and AIB Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JPMorgan Chase position performs unexpectedly, AIB Group 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 AIB Group will offset losses from the drop in AIB Group's long position.| JPMorgan Chase vs. Partner Communications | JPMorgan Chase vs. Merck Company | JPMorgan Chase vs. Western Midstream Partners | JPMorgan Chase vs. Edgewise Therapeutics |
| AIB Group vs. Plumas Bancorp | AIB Group vs. Merchants Bancorp | AIB Group vs. BancFirst | AIB Group vs. BBVA Banco Frances |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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