Correlation Between JPMorgan Chase and Xtrackers Low
Can any of the company-specific risk be diversified away by investing in both JPMorgan Chase and Xtrackers Low 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 Xtrackers Low 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 Xtrackers Low Beta, you can compare the effects of market volatilities on JPMorgan Chase and Xtrackers Low 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 Xtrackers Low. Check out your portfolio center. Please also check ongoing floating volatility patterns of JPMorgan Chase and Xtrackers Low.
Diversification Opportunities for JPMorgan Chase and Xtrackers Low
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between JPMorgan and Xtrackers is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding JPMorgan Chase Co and Xtrackers Low Beta in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xtrackers Low Beta 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 Xtrackers Low. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xtrackers Low Beta has no effect on the direction of JPMorgan Chase i.e., JPMorgan Chase and Xtrackers Low go up and down completely randomly.
Pair Corralation between JPMorgan Chase and Xtrackers Low
Considering the 90-day investment horizon JPMorgan Chase Co is expected to generate 4.47 times more return on investment than Xtrackers Low. However, JPMorgan Chase is 4.47 times more volatile than Xtrackers Low Beta. It trades about 0.13 of its potential returns per unit of risk. Xtrackers Low Beta is currently generating about 0.1 per unit of risk. If you would invest 13,393 in JPMorgan Chase Co on August 27, 2024 and sell it today you would earn a total of 11,462 from holding JPMorgan Chase Co or generate 85.58% 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. Xtrackers Low Beta
Performance |
| Timeline |
| JPMorgan Chase |
| Xtrackers Low Beta |
JPMorgan Chase and Xtrackers Low Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JPMorgan Chase and Xtrackers Low
The main advantage of trading using opposite JPMorgan Chase and Xtrackers Low positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JPMorgan Chase position performs unexpectedly, Xtrackers Low 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 Xtrackers Low will offset losses from the drop in Xtrackers Low's long position.| JPMorgan Chase vs. Nu Holdings | JPMorgan Chase vs. HSBC Holdings PLC | JPMorgan Chase vs. Bank of Montreal | JPMorgan Chase vs. Bank of Nova |
| Xtrackers Low vs. Xtrackers High Beta | Xtrackers Low vs. Xtrackers Short Duration | Xtrackers Low vs. Goldman Sachs Access | Xtrackers Low vs. FlexShares High Yield |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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