Correlation Between Americafirst Large and Jpmorgan Emerging
Can any of the company-specific risk be diversified away by investing in both Americafirst Large 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 Americafirst Large and Jpmorgan Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Americafirst Large Cap and Jpmorgan Emerging Markets, you can compare the effects of market volatilities on Americafirst Large 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 Americafirst Large with a short position of Jpmorgan Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Americafirst Large and Jpmorgan Emerging.
Diversification Opportunities for Americafirst Large and Jpmorgan Emerging
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between AMERICAFIRST and Jpmorgan is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Americafirst Large Cap 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 Americafirst Large 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 Americafirst Large Cap 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 Americafirst Large i.e., Americafirst Large and Jpmorgan Emerging go up and down completely randomly.
Pair Corralation between Americafirst Large and Jpmorgan Emerging
Assuming the 90 days horizon Americafirst Large Cap is expected to generate 2.48 times more return on investment than Jpmorgan Emerging. However, Americafirst Large is 2.48 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 0.07 per unit of risk. If you would invest 1,061 in Americafirst Large Cap on October 9, 2024 and sell it today you would earn a total of 343.00 from holding Americafirst Large Cap or generate 32.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Americafirst Large Cap vs. Jpmorgan Emerging Markets
Performance |
| Timeline |
| Americafirst Large Cap |
| Jpmorgan Emerging Markets |
Americafirst Large and Jpmorgan Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Americafirst Large and Jpmorgan Emerging
The main advantage of trading using opposite Americafirst Large and Jpmorgan Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Americafirst Large 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.| Americafirst Large vs. Forum Real Estate | Americafirst Large vs. Columbia Real Estate | Americafirst Large vs. Vy Clarion Real | Americafirst Large vs. Tiaa Cref Real Estate |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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