Correlation Between Oklahoma Municipal and Jpmorgan Short
Can any of the company-specific risk be diversified away by investing in both Oklahoma Municipal and Jpmorgan Short 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 Oklahoma Municipal and Jpmorgan Short into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Oklahoma Municipal Fund and Jpmorgan Short Duration, you can compare the effects of market volatilities on Oklahoma Municipal and Jpmorgan Short 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 Oklahoma Municipal with a short position of Jpmorgan Short. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oklahoma Municipal and Jpmorgan Short.
Diversification Opportunities for Oklahoma Municipal and Jpmorgan Short
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Oklahoma and Jpmorgan is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Oklahoma Municipal Fund and Jpmorgan Short Duration in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jpmorgan Short Duration and Oklahoma Municipal 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 Oklahoma Municipal Fund are associated (or correlated) with Jpmorgan Short. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jpmorgan Short Duration has no effect on the direction of Oklahoma Municipal i.e., Oklahoma Municipal and Jpmorgan Short go up and down completely randomly.
Pair Corralation between Oklahoma Municipal and Jpmorgan Short
Assuming the 90 days horizon Oklahoma Municipal Fund is expected to generate 2.17 times more return on investment than Jpmorgan Short. However, Oklahoma Municipal is 2.17 times more volatile than Jpmorgan Short Duration. It trades about 0.22 of its potential returns per unit of risk. Jpmorgan Short Duration is currently generating about 0.06 per unit of risk. If you would invest 1,049 in Oklahoma Municipal Fund on September 1, 2024 and sell it today you would earn a total of 17.00 from holding Oklahoma Municipal Fund or generate 1.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Oklahoma Municipal Fund vs. Jpmorgan Short Duration
Performance |
| Timeline |
| Oklahoma Municipal |
| Jpmorgan Short Duration |
Oklahoma Municipal and Jpmorgan Short Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oklahoma Municipal and Jpmorgan Short
The main advantage of trading using opposite Oklahoma Municipal and Jpmorgan Short positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oklahoma Municipal position performs unexpectedly, Jpmorgan Short 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 Short will offset losses from the drop in Jpmorgan Short's long position.| Oklahoma Municipal vs. Mesirow Financial Small | Oklahoma Municipal vs. Transamerica Financial Life | Oklahoma Municipal vs. 1919 Financial Services | Oklahoma Municipal vs. Angel Oak Financial |
| Jpmorgan Short vs. Jpmorgan Smartretirement 2035 | Jpmorgan Short vs. Jpmorgan Smartretirement 2035 | Jpmorgan Short vs. Jpmorgan Smartretirement 2035 | Jpmorgan Short vs. Jpmorgan Smartretirement 2035 |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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