Correlation Between JPMorgan Chase and Banco Macro
Can any of the company-specific risk be diversified away by investing in both JPMorgan Chase and Banco Macro 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 Banco Macro 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 Banco Macro SA, you can compare the effects of market volatilities on JPMorgan Chase and Banco Macro 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 Banco Macro. Check out your portfolio center. Please also check ongoing floating volatility patterns of JPMorgan Chase and Banco Macro.
Diversification Opportunities for JPMorgan Chase and Banco Macro
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between JPMorgan and Banco is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding JPMorgan Chase Co and Banco Macro SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Banco Macro SA 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 Banco Macro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Banco Macro SA has no effect on the direction of JPMorgan Chase i.e., JPMorgan Chase and Banco Macro go up and down completely randomly.
Pair Corralation between JPMorgan Chase and Banco Macro
Considering the 90-day investment horizon JPMorgan Chase is expected to generate 1.14 times less return on investment than Banco Macro. But when comparing it to its historical volatility, JPMorgan Chase Co is 1.06 times less risky than Banco Macro. It trades about 0.21 of its potential returns per unit of risk. Banco Macro SA is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 7,509 in Banco Macro SA on September 4, 2024 and sell it today you would earn a total of 981.00 from holding Banco Macro SA or generate 13.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.24% |
| Values | Daily Returns |
JPMorgan Chase Co vs. Banco Macro SA
Performance |
| Timeline |
| JPMorgan Chase |
| Banco Macro SA |
JPMorgan Chase and Banco Macro Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JPMorgan Chase and Banco Macro
The main advantage of trading using opposite JPMorgan Chase and Banco Macro positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JPMorgan Chase position performs unexpectedly, Banco Macro 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 Banco Macro will offset losses from the drop in Banco Macro's long position.| JPMorgan Chase vs. Citigroup | JPMorgan Chase vs. Aquagold International | JPMorgan Chase vs. Thrivent High Yield | JPMorgan Chase vs. Morningstar Unconstrained Allocation |
| Banco Macro vs. Grupo Supervielle SA | Banco Macro vs. BBVA Banco Frances | Banco Macro vs. Banco Bradesco SA | Banco Macro vs. Itau Unibanco Banco |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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