Correlation Between JPMorgan Chase and Nuveen Municipal
Can any of the company-specific risk be diversified away by investing in both JPMorgan Chase and Nuveen Municipal 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 Nuveen Municipal 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 Nuveen Municipal Credit, you can compare the effects of market volatilities on JPMorgan Chase and Nuveen Municipal 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 Nuveen Municipal. Check out your portfolio center. Please also check ongoing floating volatility patterns of JPMorgan Chase and Nuveen Municipal.
Diversification Opportunities for JPMorgan Chase and Nuveen Municipal
-0.77 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between JPMorgan and Nuveen is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding JPMorgan Chase Co and Nuveen Municipal Credit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nuveen Municipal Credit 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 Nuveen Municipal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nuveen Municipal Credit has no effect on the direction of JPMorgan Chase i.e., JPMorgan Chase and Nuveen Municipal go up and down completely randomly.
Pair Corralation between JPMorgan Chase and Nuveen Municipal
Considering the 90-day investment horizon JPMorgan Chase Co is expected to generate 3.76 times more return on investment than Nuveen Municipal. However, JPMorgan Chase is 3.76 times more volatile than Nuveen Municipal Credit. It trades about 0.19 of its potential returns per unit of risk. Nuveen Municipal Credit is currently generating about 0.08 per unit of risk. If you would invest 22,550 in JPMorgan Chase Co on August 28, 2024 and sell it today you would earn a total of 2,479 from holding JPMorgan Chase Co or generate 10.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
JPMorgan Chase Co vs. Nuveen Municipal Credit
Performance |
| Timeline |
| JPMorgan Chase |
| Nuveen Municipal Credit |
JPMorgan Chase and Nuveen Municipal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JPMorgan Chase and Nuveen Municipal
The main advantage of trading using opposite JPMorgan Chase and Nuveen Municipal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JPMorgan Chase position performs unexpectedly, Nuveen Municipal 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 Nuveen Municipal will offset losses from the drop in Nuveen Municipal'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 |
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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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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