Correlation Between JPMorgan Fundamental and ETF Series
Can any of the company-specific risk be diversified away by investing in both JPMorgan Fundamental and ETF Series 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 Fundamental and ETF Series into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JPMorgan Fundamental Data and ETF Series Solutions, you can compare the effects of market volatilities on JPMorgan Fundamental and ETF Series 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 Fundamental with a short position of ETF Series. Check out your portfolio center. Please also check ongoing floating volatility patterns of JPMorgan Fundamental and ETF Series.
Diversification Opportunities for JPMorgan Fundamental and ETF Series
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between JPMorgan and ETF is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding JPMorgan Fundamental Data and ETF Series Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ETF Series Solutions and JPMorgan Fundamental 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 Fundamental Data are associated (or correlated) with ETF Series. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ETF Series Solutions has no effect on the direction of JPMorgan Fundamental i.e., JPMorgan Fundamental and ETF Series go up and down completely randomly.
Pair Corralation between JPMorgan Fundamental and ETF Series
Given the investment horizon of 90 days JPMorgan Fundamental Data is expected to generate 1.08 times more return on investment than ETF Series. However, JPMorgan Fundamental is 1.08 times more volatile than ETF Series Solutions. It trades about 0.26 of its potential returns per unit of risk. ETF Series Solutions is currently generating about 0.07 per unit of risk. If you would invest 4,992 in JPMorgan Fundamental Data on September 13, 2024 and sell it today you would earn a total of 891.23 from holding JPMorgan Fundamental Data or generate 17.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 72.58% |
| Values | Daily Returns |
JPMorgan Fundamental Data vs. ETF Series Solutions
Performance |
| Timeline |
| JPMorgan Fundamental Data |
| ETF Series Solutions |
JPMorgan Fundamental and ETF Series Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JPMorgan Fundamental and ETF Series
The main advantage of trading using opposite JPMorgan Fundamental and ETF Series positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JPMorgan Fundamental position performs unexpectedly, ETF Series 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 ETF Series will offset losses from the drop in ETF Series' long position.| JPMorgan Fundamental vs. FT Vest Equity | JPMorgan Fundamental vs. Northern Lights | JPMorgan Fundamental vs. Dimensional International High | JPMorgan Fundamental vs. Matthews China Discovery |
| ETF Series vs. FT Vest Equity | ETF Series vs. Northern Lights | ETF Series vs. Dimensional International High | ETF Series vs. JPMorgan Fundamental Data |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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