Correlation Between JPMorgan Chase and ProShares
Can any of the company-specific risk be diversified away by investing in both JPMorgan Chase and ProShares 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 ProShares 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 ProShares SP MidCap, you can compare the effects of market volatilities on JPMorgan Chase and ProShares 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 ProShares. Check out your portfolio center. Please also check ongoing floating volatility patterns of JPMorgan Chase and ProShares.
Diversification Opportunities for JPMorgan Chase and ProShares
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between JPMorgan and ProShares is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding JPMorgan Chase Co and ProShares SP MidCap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ProShares SP MidCap 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 ProShares. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ProShares SP MidCap has no effect on the direction of JPMorgan Chase i.e., JPMorgan Chase and ProShares go up and down completely randomly.
Pair Corralation between JPMorgan Chase and ProShares
Considering the 90-day investment horizon JPMorgan Chase Co is expected to generate 1.44 times more return on investment than ProShares. However, JPMorgan Chase is 1.44 times more volatile than ProShares SP MidCap. It trades about 0.13 of its potential returns per unit of risk. ProShares SP MidCap is currently generating about 0.09 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 Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
JPMorgan Chase Co vs. ProShares SP MidCap
Performance |
| Timeline |
| JPMorgan Chase |
| ProShares SP MidCap |
JPMorgan Chase and ProShares Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JPMorgan Chase and ProShares
The main advantage of trading using opposite JPMorgan Chase and ProShares positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JPMorgan Chase position performs unexpectedly, ProShares 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 ProShares will offset losses from the drop in ProShares' 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 |
| ProShares vs. Vanguard Mid Cap Index | ProShares vs. iShares Core SP | ProShares vs. SPDR SP MIDCAP | ProShares vs. First Trust Dorsey |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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