Correlation Between JPMorgan ETFs and Sabre Insurance
Can any of the company-specific risk be diversified away by investing in both JPMorgan ETFs and Sabre Insurance 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 ETFs and Sabre Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JPMorgan ETFs ICAV and Sabre Insurance Group, you can compare the effects of market volatilities on JPMorgan ETFs and Sabre Insurance 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 ETFs with a short position of Sabre Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of JPMorgan ETFs and Sabre Insurance.
Diversification Opportunities for JPMorgan ETFs and Sabre Insurance
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between JPMorgan and Sabre is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding JPMorgan ETFs ICAV and Sabre Insurance Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sabre Insurance Group and JPMorgan ETFs 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 ETFs ICAV are associated (or correlated) with Sabre Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sabre Insurance Group has no effect on the direction of JPMorgan ETFs i.e., JPMorgan ETFs and Sabre Insurance go up and down completely randomly.
Pair Corralation between JPMorgan ETFs and Sabre Insurance
Assuming the 90 days trading horizon JPMorgan ETFs ICAV is expected to generate 0.33 times more return on investment than Sabre Insurance. However, JPMorgan ETFs ICAV is 3.04 times less risky than Sabre Insurance. It trades about 0.08 of its potential returns per unit of risk. Sabre Insurance Group is currently generating about 0.02 per unit of risk. If you would invest 310,090 in JPMorgan ETFs ICAV on August 30, 2024 and sell it today you would earn a total of 3,230 from holding JPMorgan ETFs ICAV or generate 1.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
JPMorgan ETFs ICAV vs. Sabre Insurance Group
Performance |
| Timeline |
| JPMorgan ETFs ICAV |
| Sabre Insurance Group |
JPMorgan ETFs and Sabre Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JPMorgan ETFs and Sabre Insurance
The main advantage of trading using opposite JPMorgan ETFs and Sabre Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JPMorgan ETFs position performs unexpectedly, Sabre Insurance 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 Sabre Insurance will offset losses from the drop in Sabre Insurance's long position.| JPMorgan ETFs vs. Leverage Shares 3x | JPMorgan ETFs vs. Leverage Shares 3x | JPMorgan ETFs vs. GraniteShares 3x Short | JPMorgan ETFs vs. Leverage Shares 3x |
| Sabre Insurance vs. Samsung Electronics Co | Sabre Insurance vs. Samsung Electronics Co | Sabre Insurance vs. Toyota Motor Corp | Sabre Insurance vs. Reliance Industries Ltd |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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