Correlation Between JPMorgan Chase and EGSHARES BLUE
Can any of the company-specific risk be diversified away by investing in both JPMorgan Chase and EGSHARES BLUE 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 EGSHARES BLUE 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 EGSHARES BLUE CHIP, you can compare the effects of market volatilities on JPMorgan Chase and EGSHARES BLUE 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 EGSHARES BLUE. Check out your portfolio center. Please also check ongoing floating volatility patterns of JPMorgan Chase and EGSHARES BLUE.
Diversification Opportunities for JPMorgan Chase and EGSHARES BLUE
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between JPMorgan and EGSHARES is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding JPMorgan Chase Co and EGSHARES BLUE CHIP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EGSHARES BLUE CHIP 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 EGSHARES BLUE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EGSHARES BLUE CHIP has no effect on the direction of JPMorgan Chase i.e., JPMorgan Chase and EGSHARES BLUE go up and down completely randomly.
Pair Corralation between JPMorgan Chase and EGSHARES BLUE
Considering the 90-day investment horizon JPMorgan Chase Co is expected to generate 2.64 times more return on investment than EGSHARES BLUE. However, JPMorgan Chase is 2.64 times more volatile than EGSHARES BLUE CHIP. It trades about 0.18 of its potential returns per unit of risk. EGSHARES BLUE CHIP is currently generating about 0.23 per unit of risk. If you would invest 22,550 in JPMorgan Chase Co on August 29, 2024 and sell it today you would earn a total of 2,432 from holding JPMorgan Chase Co or generate 10.78% 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. EGSHARES BLUE CHIP
Performance |
| Timeline |
| JPMorgan Chase |
| EGSHARES BLUE CHIP |
JPMorgan Chase and EGSHARES BLUE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JPMorgan Chase and EGSHARES BLUE
The main advantage of trading using opposite JPMorgan Chase and EGSHARES BLUE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JPMorgan Chase position performs unexpectedly, EGSHARES BLUE 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 EGSHARES BLUE will offset losses from the drop in EGSHARES BLUE's long position.| JPMorgan Chase vs. Citigroup | JPMorgan Chase vs. Wells Fargo | JPMorgan Chase vs. Toronto Dominion Bank | JPMorgan Chase vs. Nu Holdings |
| EGSHARES BLUE vs. FT Vest Equity | EGSHARES BLUE vs. Northern Lights | EGSHARES BLUE vs. Dimensional International High | EGSHARES BLUE vs. First Trust Exchange Traded |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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