Correlation Between JPMorgan Chase and ProShares Short
Can any of the company-specific risk be diversified away by investing in both JPMorgan Chase and ProShares Short 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 Short 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 Short SmallCap600, you can compare the effects of market volatilities on JPMorgan Chase and ProShares Short 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 Short. Check out your portfolio center. Please also check ongoing floating volatility patterns of JPMorgan Chase and ProShares Short.
Diversification Opportunities for JPMorgan Chase and ProShares Short
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between JPMorgan and ProShares is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding JPMorgan Chase Co and ProShares Short SmallCap600 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ProShares Short Smal 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 Short. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ProShares Short Smal has no effect on the direction of JPMorgan Chase i.e., JPMorgan Chase and ProShares Short go up and down completely randomly.
Pair Corralation between JPMorgan Chase and ProShares Short
Considering the 90-day investment horizon JPMorgan Chase Co is expected to generate 1.53 times more return on investment than ProShares Short. However, JPMorgan Chase is 1.53 times more volatile than ProShares Short SmallCap600. It trades about 0.2 of its potential returns per unit of risk. ProShares Short SmallCap600 is currently generating about -0.22 per unit of risk. If you would invest 22,290 in JPMorgan Chase Co on August 30, 2024 and sell it today you would earn a total of 2,689 from holding JPMorgan Chase Co or generate 12.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
JPMorgan Chase Co vs. ProShares Short SmallCap600
Performance |
| Timeline |
| JPMorgan Chase |
| ProShares Short Smal |
JPMorgan Chase and ProShares Short Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JPMorgan Chase and ProShares Short
The main advantage of trading using opposite JPMorgan Chase and ProShares Short positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JPMorgan Chase position performs unexpectedly, ProShares Short 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 Short will offset losses from the drop in ProShares Short's long position.| JPMorgan Chase vs. Citigroup | JPMorgan Chase vs. Wells Fargo | JPMorgan Chase vs. Royal Bank of | JPMorgan Chase vs. Nu Holdings |
| ProShares Short vs. ProShares Short MidCap400 | ProShares Short vs. ProShares UltraShort SmallCap600 | ProShares Short vs. ProShares UltraShort MidCap400 | ProShares Short vs. ProShares UltraShort Health |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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