Correlation Between Emerging Markets and Jpmorgan Emerging
Can any of the company-specific risk be diversified away by investing in both Emerging Markets and Jpmorgan Emerging 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 Emerging Markets and Jpmorgan Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Emerging Markets Bond and Jpmorgan Emerging Markets, you can compare the effects of market volatilities on Emerging Markets and Jpmorgan Emerging 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 Emerging Markets with a short position of Jpmorgan Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Emerging Markets and Jpmorgan Emerging.
Diversification Opportunities for Emerging Markets and Jpmorgan Emerging
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Emerging and Jpmorgan is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Emerging Markets Bond and Jpmorgan Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jpmorgan Emerging Markets and Emerging Markets 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 Emerging Markets Bond are associated (or correlated) with Jpmorgan Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jpmorgan Emerging Markets has no effect on the direction of Emerging Markets i.e., Emerging Markets and Jpmorgan Emerging go up and down completely randomly.
Pair Corralation between Emerging Markets and Jpmorgan Emerging
Assuming the 90 days horizon Emerging Markets is expected to generate 1.02 times less return on investment than Jpmorgan Emerging. But when comparing it to its historical volatility, Emerging Markets Bond is 1.14 times less risky than Jpmorgan Emerging. It trades about 0.16 of its potential returns per unit of risk. Jpmorgan Emerging Markets is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 621.00 in Jpmorgan Emerging Markets on November 3, 2024 and sell it today you would earn a total of 6.00 from holding Jpmorgan Emerging Markets or generate 0.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Emerging Markets Bond vs. Jpmorgan Emerging Markets
Performance |
| Timeline |
| Emerging Markets Bond |
| Jpmorgan Emerging Markets |
Emerging Markets and Jpmorgan Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Emerging Markets and Jpmorgan Emerging
The main advantage of trading using opposite Emerging Markets and Jpmorgan Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Emerging Markets position performs unexpectedly, Jpmorgan Emerging 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 Emerging will offset losses from the drop in Jpmorgan Emerging's long position.| Emerging Markets vs. Mirova Global Green | Emerging Markets vs. Chartwell Short Duration | Emerging Markets vs. Multisector Bond Sma | Emerging Markets vs. Versatile Bond Portfolio |
| Jpmorgan Emerging vs. Invesco Global Health | Jpmorgan Emerging vs. Blackrock Health Sciences | Jpmorgan Emerging vs. The Hartford Healthcare | Jpmorgan Emerging vs. Blackrock Health Sciences |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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