Correlation Between JPMorgan Fundamental and SPDR SP
Can any of the company-specific risk be diversified away by investing in both JPMorgan Fundamental and SPDR SP 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 SPDR SP 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 SPDR SP 500, you can compare the effects of market volatilities on JPMorgan Fundamental and SPDR SP 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 SPDR SP. Check out your portfolio center. Please also check ongoing floating volatility patterns of JPMorgan Fundamental and SPDR SP.
Diversification Opportunities for JPMorgan Fundamental and SPDR SP
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between JPMorgan and SPDR is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding JPMorgan Fundamental Data and SPDR SP 500 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPDR SP 500 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 SPDR SP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPDR SP 500 has no effect on the direction of JPMorgan Fundamental i.e., JPMorgan Fundamental and SPDR SP go up and down completely randomly.
Pair Corralation between JPMorgan Fundamental and SPDR SP
Given the investment horizon of 90 days JPMorgan Fundamental Data is expected to generate 0.89 times more return on investment than SPDR SP. However, JPMorgan Fundamental Data is 1.13 times less risky than SPDR SP. It trades about 0.31 of its potential returns per unit of risk. SPDR SP 500 is currently generating about 0.17 per unit of risk. If you would invest 5,553 in JPMorgan Fundamental Data on November 3, 2024 and sell it today you would earn a total of 266.00 from holding JPMorgan Fundamental Data or generate 4.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.24% |
| Values | Daily Returns |
JPMorgan Fundamental Data vs. SPDR SP 500
Performance |
| Timeline |
| JPMorgan Fundamental Data |
| SPDR SP 500 |
JPMorgan Fundamental and SPDR SP Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JPMorgan Fundamental and SPDR SP
The main advantage of trading using opposite JPMorgan Fundamental and SPDR SP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JPMorgan Fundamental position performs unexpectedly, SPDR SP 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 SPDR SP will offset losses from the drop in SPDR SP's long position.| JPMorgan Fundamental vs. Davis Select International | JPMorgan Fundamental vs. Dimensional ETF Trust | JPMorgan Fundamental vs. Principal Value ETF | JPMorgan Fundamental vs. Vanguard Small Cap Index |
| SPDR SP vs. FT Vest Equity | SPDR SP vs. Northern Lights | SPDR SP vs. Dimensional International High | SPDR SP vs. First Trust Exchange Traded |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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