Correlation Between Polar Capital and JPMorgan Emerging
Can any of the company-specific risk be diversified away by investing in both Polar Capital 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 Polar Capital and JPMorgan Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Polar Capital Technology and JPMorgan Emerging Markets, you can compare the effects of market volatilities on Polar Capital 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 Polar Capital with a short position of JPMorgan Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Polar Capital and JPMorgan Emerging.
Diversification Opportunities for Polar Capital and JPMorgan Emerging
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Polar and JPMorgan is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Polar Capital Technology 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 Polar Capital 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 Polar Capital Technology 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 Polar Capital i.e., Polar Capital and JPMorgan Emerging go up and down completely randomly.
Pair Corralation between Polar Capital and JPMorgan Emerging
Assuming the 90 days trading horizon Polar Capital Technology is expected to generate 1.62 times more return on investment than JPMorgan Emerging. However, Polar Capital is 1.62 times more volatile than JPMorgan Emerging Markets. It trades about 0.07 of its potential returns per unit of risk. JPMorgan Emerging Markets is currently generating about 0.1 per unit of risk. If you would invest 35,450 in Polar Capital Technology on November 2, 2024 and sell it today you would earn a total of 950.00 from holding Polar Capital Technology or generate 2.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Polar Capital Technology vs. JPMorgan Emerging Markets
Performance |
| Timeline |
| Polar Capital Technology |
| JPMorgan Emerging Markets |
Polar Capital and JPMorgan Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Polar Capital and JPMorgan Emerging
The main advantage of trading using opposite Polar Capital and JPMorgan Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Polar Capital 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.| Polar Capital vs. Endeavour Mining Corp | Polar Capital vs. Jacquet Metal Service | Polar Capital vs. Tyson Foods Cl | Polar Capital vs. Tatton Asset Management |
| JPMorgan Emerging vs. Hilton Food Group | JPMorgan Emerging vs. United Utilities Group | JPMorgan Emerging vs. Aeorema Communications Plc | JPMorgan Emerging vs. Zegona Communications Plc |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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