Correlation Between Jpmorgan Smartretirement* and High Yield
Can any of the company-specific risk be diversified away by investing in both Jpmorgan Smartretirement* and High Yield 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 Smartretirement* and High Yield into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jpmorgan Smartretirement Blend and High Yield Municipal Fund, you can compare the effects of market volatilities on Jpmorgan Smartretirement* and High Yield 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 Smartretirement* with a short position of High Yield. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jpmorgan Smartretirement* and High Yield.
Diversification Opportunities for Jpmorgan Smartretirement* and High Yield
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Jpmorgan and High is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Jpmorgan Smartretirement Blend and High Yield Municipal Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on High Yield Municipal and Jpmorgan Smartretirement* 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 Smartretirement Blend are associated (or correlated) with High Yield. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of High Yield Municipal has no effect on the direction of Jpmorgan Smartretirement* i.e., Jpmorgan Smartretirement* and High Yield go up and down completely randomly.
Pair Corralation between Jpmorgan Smartretirement* and High Yield
Assuming the 90 days horizon Jpmorgan Smartretirement Blend is expected to generate 1.69 times more return on investment than High Yield. However, Jpmorgan Smartretirement* is 1.69 times more volatile than High Yield Municipal Fund. It trades about 0.14 of its potential returns per unit of risk. High Yield Municipal Fund is currently generating about 0.0 per unit of risk. If you would invest 2,593 in Jpmorgan Smartretirement Blend on October 20, 2024 and sell it today you would earn a total of 35.00 from holding Jpmorgan Smartretirement Blend or generate 1.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jpmorgan Smartretirement Blend vs. High Yield Municipal Fund
Performance |
| Timeline |
| Jpmorgan Smartretirement* |
| High Yield Municipal |
Jpmorgan Smartretirement* and High Yield Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jpmorgan Smartretirement* and High Yield
The main advantage of trading using opposite Jpmorgan Smartretirement* and High Yield positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jpmorgan Smartretirement* position performs unexpectedly, High Yield 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 High Yield will offset losses from the drop in High Yield's long position.The idea behind Jpmorgan Smartretirement Blend and High Yield Municipal Fund pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
| High Yield vs. High Yield Fund Investor | High Yield vs. Intermediate Term Tax Free Bond | High Yield vs. California High Yield Municipal | High Yield vs. T Rowe Price |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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