Correlation Between Lumia and JPMorgan Chase
Can any of the company-specific risk be diversified away by investing in both Lumia and JPMorgan Chase 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 Lumia and JPMorgan Chase into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lumia and JPMorgan Chase Co, you can compare the effects of market volatilities on Lumia and JPMorgan Chase 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 Lumia with a short position of JPMorgan Chase. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lumia and JPMorgan Chase.
Diversification Opportunities for Lumia and JPMorgan Chase
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Lumia and JPMorgan is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Lumia and JPMorgan Chase Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JPMorgan Chase and Lumia 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 Lumia are associated (or correlated) with JPMorgan Chase. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JPMorgan Chase has no effect on the direction of Lumia i.e., Lumia and JPMorgan Chase go up and down completely randomly.
Pair Corralation between Lumia and JPMorgan Chase
Assuming the 90 days trading horizon Lumia is expected to under-perform the JPMorgan Chase. In addition to that, Lumia is 5.94 times more volatile than JPMorgan Chase Co. It trades about -0.14 of its total potential returns per unit of risk. JPMorgan Chase Co is currently generating about 0.47 per unit of volatility. If you would invest 3,081 in JPMorgan Chase Co on October 20, 2024 and sell it today you would earn a total of 361.00 from holding JPMorgan Chase Co or generate 11.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 90.91% |
| Values | Daily Returns |
Lumia vs. JPMorgan Chase Co
Performance |
| Timeline |
| Lumia |
| JPMorgan Chase |
Lumia and JPMorgan Chase Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lumia and JPMorgan Chase
The main advantage of trading using opposite Lumia and JPMorgan Chase positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lumia position performs unexpectedly, JPMorgan Chase 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 JPMorgan Chase will offset losses from the drop in JPMorgan Chase's long position.The idea behind Lumia and JPMorgan Chase Co 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.| JPMorgan Chase vs. Lion One Metals | JPMorgan Chase vs. Western Copper and | JPMorgan Chase vs. Information Services | JPMorgan Chase vs. Quorum Information Technologies |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
Other Complementary Tools
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated |