Correlation Between Jp Morgan and Payden Emerging
Can any of the company-specific risk be diversified away by investing in both Jp Morgan and Payden Emerging 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 Jp Morgan and Payden Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jp Morgan Smartretirement and Payden Emerging Markets, you can compare the effects of market volatilities on Jp Morgan and Payden Emerging 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 Jp Morgan with a short position of Payden Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jp Morgan and Payden Emerging.
Diversification Opportunities for Jp Morgan and Payden Emerging
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between JTSQX and Payden is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Jp Morgan Smartretirement and Payden Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Payden Emerging Markets and Jp Morgan 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 Jp Morgan Smartretirement are associated (or correlated) with Payden Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Payden Emerging Markets has no effect on the direction of Jp Morgan i.e., Jp Morgan and Payden Emerging go up and down completely randomly.
Pair Corralation between Jp Morgan and Payden Emerging
Assuming the 90 days horizon Jp Morgan Smartretirement is expected to generate 1.94 times more return on investment than Payden Emerging. However, Jp Morgan is 1.94 times more volatile than Payden Emerging Markets. It trades about 0.1 of its potential returns per unit of risk. Payden Emerging Markets is currently generating about 0.13 per unit of risk. If you would invest 1,847 in Jp Morgan Smartretirement on September 1, 2024 and sell it today you would earn a total of 531.00 from holding Jp Morgan Smartretirement or generate 28.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.73% |
| Values | Daily Returns |
Jp Morgan Smartretirement vs. Payden Emerging Markets
Performance |
| Timeline |
| Jp Morgan Smartretirement |
| Payden Emerging Markets |
Jp Morgan and Payden Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jp Morgan and Payden Emerging
The main advantage of trading using opposite Jp Morgan and Payden Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jp Morgan position performs unexpectedly, Payden Emerging 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 Payden Emerging will offset losses from the drop in Payden Emerging's long position.| Jp Morgan vs. Pace High Yield | Jp Morgan vs. Prudential Short Duration | Jp Morgan vs. Valic Company I | Jp Morgan vs. Virtus High Yield |
| Payden Emerging vs. Ab All Market | Payden Emerging vs. Western Asset Diversified | Payden Emerging vs. Harbor Diversified International | Payden Emerging vs. Calvert Developed Market |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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