Correlation Between JPMorgan Chase and Southern California
Can any of the company-specific risk be diversified away by investing in both JPMorgan Chase and Southern California 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 Southern California 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 Southern California Bancorp, you can compare the effects of market volatilities on JPMorgan Chase and Southern California 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 Southern California. Check out your portfolio center. Please also check ongoing floating volatility patterns of JPMorgan Chase and Southern California.
Diversification Opportunities for JPMorgan Chase and Southern California
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between JPMorgan and Southern is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding JPMorgan Chase Co and Southern California Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Southern California 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 Southern California. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Southern California has no effect on the direction of JPMorgan Chase i.e., JPMorgan Chase and Southern California go up and down completely randomly.
Pair Corralation between JPMorgan Chase and Southern California
Considering the 90-day investment horizon JPMorgan Chase Co is expected to generate 0.83 times more return on investment than Southern California. However, JPMorgan Chase Co is 1.2 times less risky than Southern California. It trades about 0.12 of its potential returns per unit of risk. Southern California Bancorp is currently generating about 0.05 per unit of risk. If you would invest 14,492 in JPMorgan Chase Co on September 12, 2024 and sell it today you would earn a total of 9,794 from holding JPMorgan Chase Co or generate 67.58% 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. Southern California Bancorp
Performance |
| Timeline |
| JPMorgan Chase |
| Southern California |
JPMorgan Chase and Southern California Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JPMorgan Chase and Southern California
The main advantage of trading using opposite JPMorgan Chase and Southern California positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JPMorgan Chase position performs unexpectedly, Southern California 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 Southern California will offset losses from the drop in Southern California's long position.| JPMorgan Chase vs. Bank of America | JPMorgan Chase vs. Victory Integrity Smallmid Cap | JPMorgan Chase vs. Hilton Worldwide Holdings | JPMorgan Chase vs. NVIDIA |
| Southern California vs. JPMorgan Chase Co | Southern California vs. Citigroup | Southern California vs. Wells Fargo | Southern California vs. Toronto Dominion Bank |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
Other Complementary Tools
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. |