Correlation Between JPMorgan Chase and New Age
Can any of the company-specific risk be diversified away by investing in both JPMorgan Chase and New Age 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 New Age 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 New Age Metals, you can compare the effects of market volatilities on JPMorgan Chase and New Age 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 New Age. Check out your portfolio center. Please also check ongoing floating volatility patterns of JPMorgan Chase and New Age.
Diversification Opportunities for JPMorgan Chase and New Age
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between JPMorgan and New is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding JPMorgan Chase Co and New Age Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on New Age Metals 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 New Age. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of New Age Metals has no effect on the direction of JPMorgan Chase i.e., JPMorgan Chase and New Age go up and down completely randomly.
Pair Corralation between JPMorgan Chase and New Age
Considering the 90-day investment horizon JPMorgan Chase Co is expected to generate 0.14 times more return on investment than New Age. However, JPMorgan Chase Co is 7.31 times less risky than New Age. It trades about 0.14 of its potential returns per unit of risk. New Age Metals is currently generating about -0.05 per unit of risk. If you would invest 24,900 in JPMorgan Chase Co on October 26, 2024 and sell it today you would earn a total of 1,562 from holding JPMorgan Chase Co or generate 6.27% 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. New Age Metals
Performance |
| Timeline |
| JPMorgan Chase |
| New Age Metals |
JPMorgan Chase and New Age Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JPMorgan Chase and New Age
The main advantage of trading using opposite JPMorgan Chase and New Age positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JPMorgan Chase position performs unexpectedly, New Age 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 New Age will offset losses from the drop in New Age's long position.| JPMorgan Chase vs. Toronto Dominion Bank | JPMorgan Chase vs. Royal Bank of | JPMorgan Chase vs. Nu Holdings | JPMorgan Chase vs. HSBC Holdings PLC |
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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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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