Correlation Between Short Oil and Jpmorgan Smartretirement
Can any of the company-specific risk be diversified away by investing in both Short Oil and Jpmorgan Smartretirement 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 Short Oil and Jpmorgan Smartretirement into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Short Oil Gas and Jpmorgan Smartretirement 2035, you can compare the effects of market volatilities on Short Oil and Jpmorgan Smartretirement 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 Short Oil with a short position of Jpmorgan Smartretirement. Check out your portfolio center. Please also check ongoing floating volatility patterns of Short Oil and Jpmorgan Smartretirement.
Diversification Opportunities for Short Oil and Jpmorgan Smartretirement
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Short and Jpmorgan is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Short Oil Gas and Jpmorgan Smartretirement 2035 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jpmorgan Smartretirement and Short Oil 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 Short Oil Gas are associated (or correlated) with Jpmorgan Smartretirement. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jpmorgan Smartretirement has no effect on the direction of Short Oil i.e., Short Oil and Jpmorgan Smartretirement go up and down completely randomly.
Pair Corralation between Short Oil and Jpmorgan Smartretirement
Assuming the 90 days horizon Short Oil Gas is expected to under-perform the Jpmorgan Smartretirement. In addition to that, Short Oil is 1.48 times more volatile than Jpmorgan Smartretirement 2035. It trades about -0.46 of its total potential returns per unit of risk. Jpmorgan Smartretirement 2035 is currently generating about 0.14 per unit of volatility. If you would invest 1,999 in Jpmorgan Smartretirement 2035 on October 25, 2024 and sell it today you would earn a total of 30.00 from holding Jpmorgan Smartretirement 2035 or generate 1.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Short Oil Gas vs. Jpmorgan Smartretirement 2035
Performance |
| Timeline |
| Short Oil Gas |
| Jpmorgan Smartretirement |
Short Oil and Jpmorgan Smartretirement Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Short Oil and Jpmorgan Smartretirement
The main advantage of trading using opposite Short Oil and Jpmorgan Smartretirement positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Short Oil position performs unexpectedly, Jpmorgan Smartretirement 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 Smartretirement will offset losses from the drop in Jpmorgan Smartretirement's long position.| Short Oil vs. Short Precious Metals | Short Oil vs. Short Oil Gas | Short Oil vs. Floating Rate Fund | Short Oil vs. GE Aerospace |
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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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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