Correlation Between JPMorgan Chase and ETRACS IFED
Can any of the company-specific risk be diversified away by investing in both JPMorgan Chase and ETRACS IFED 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 ETRACS IFED 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 ETRACS IFED Invest, you can compare the effects of market volatilities on JPMorgan Chase and ETRACS IFED 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 ETRACS IFED. Check out your portfolio center. Please also check ongoing floating volatility patterns of JPMorgan Chase and ETRACS IFED.
Diversification Opportunities for JPMorgan Chase and ETRACS IFED
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between JPMorgan and ETRACS is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding JPMorgan Chase Co and ETRACS IFED Invest in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ETRACS IFED Invest 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 ETRACS IFED. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ETRACS IFED Invest has no effect on the direction of JPMorgan Chase i.e., JPMorgan Chase and ETRACS IFED go up and down completely randomly.
Pair Corralation between JPMorgan Chase and ETRACS IFED
Considering the 90-day investment horizon JPMorgan Chase Co is expected to generate 1.23 times more return on investment than ETRACS IFED. However, JPMorgan Chase is 1.23 times more volatile than ETRACS IFED Invest. It trades about 0.11 of its potential returns per unit of risk. ETRACS IFED Invest is currently generating about 0.09 per unit of risk. If you would invest 19,949 in JPMorgan Chase Co on September 1, 2024 and sell it today you would earn a total of 5,023 from holding JPMorgan Chase Co or generate 25.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 99.21% |
| Values | Daily Returns |
JPMorgan Chase Co vs. ETRACS IFED Invest
Performance |
| Timeline |
| JPMorgan Chase |
| ETRACS IFED Invest |
JPMorgan Chase and ETRACS IFED Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JPMorgan Chase and ETRACS IFED
The main advantage of trading using opposite JPMorgan Chase and ETRACS IFED positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JPMorgan Chase position performs unexpectedly, ETRACS IFED 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 ETRACS IFED will offset losses from the drop in ETRACS IFED's long position.| JPMorgan Chase vs. Citigroup | JPMorgan Chase vs. Nu Holdings | JPMorgan Chase vs. HSBC Holdings PLC | JPMorgan Chase vs. Bank of Montreal |
| ETRACS IFED vs. Vanguard Total Stock | ETRACS IFED vs. SPDR SP 500 | ETRACS IFED vs. iShares Core SP | ETRACS IFED vs. Vanguard Dividend Appreciation |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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