Correlation Between Jpmorgan Value and FT Cboe
Can any of the company-specific risk be diversified away by investing in both Jpmorgan Value and FT Cboe 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 Value and FT Cboe into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jpmorgan Value Advantage and FT Cboe Vest, you can compare the effects of market volatilities on Jpmorgan Value and FT Cboe 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 Value with a short position of FT Cboe. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jpmorgan Value and FT Cboe.
Diversification Opportunities for Jpmorgan Value and FT Cboe
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Jpmorgan and KNG is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Jpmorgan Value Advantage and FT Cboe Vest in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FT Cboe Vest and Jpmorgan Value 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 Value Advantage are associated (or correlated) with FT Cboe. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FT Cboe Vest has no effect on the direction of Jpmorgan Value i.e., Jpmorgan Value and FT Cboe go up and down completely randomly.
Pair Corralation between Jpmorgan Value and FT Cboe
Assuming the 90 days horizon Jpmorgan Value is expected to generate 1.14 times less return on investment than FT Cboe. But when comparing it to its historical volatility, Jpmorgan Value Advantage is 1.13 times less risky than FT Cboe. It trades about 0.22 of its potential returns per unit of risk. FT Cboe Vest is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 4,984 in FT Cboe Vest on November 4, 2024 and sell it today you would earn a total of 167.00 from holding FT Cboe Vest or generate 3.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.0% |
| Values | Daily Returns |
Jpmorgan Value Advantage vs. FT Cboe Vest
Performance |
| Timeline |
| Jpmorgan Value Advantage |
| FT Cboe Vest |
Jpmorgan Value and FT Cboe Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jpmorgan Value and FT Cboe
The main advantage of trading using opposite Jpmorgan Value and FT Cboe positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jpmorgan Value position performs unexpectedly, FT Cboe 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 FT Cboe will offset losses from the drop in FT Cboe's long position.| Jpmorgan Value vs. Jpmorgan Growth Advantage | Jpmorgan Value vs. Jpmorgan Equity Income | Jpmorgan Value vs. John Hancock Disciplined | Jpmorgan Value vs. Jpmorgan Mid Cap |
| FT Cboe vs. Global X SP | FT Cboe vs. Global X Nasdaq | FT Cboe vs. First Trust BuyWrite | FT Cboe vs. Amplify CWP Enhanced |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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