Correlation Between Mid Cap and Jpmorgan
Can any of the company-specific risk be diversified away by investing in both Mid Cap and Jpmorgan 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 Mid Cap and Jpmorgan into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mid Cap Growth and Jpmorgan Equity Fund, you can compare the effects of market volatilities on Mid Cap and Jpmorgan 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 Mid Cap with a short position of Jpmorgan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mid Cap and Jpmorgan.
Diversification Opportunities for Mid Cap and Jpmorgan
Almost no diversification
The 3 months correlation between Mid and Jpmorgan is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Mid Cap Growth and Jpmorgan Equity Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jpmorgan Equity and Mid Cap 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 Mid Cap Growth are associated (or correlated) with Jpmorgan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jpmorgan Equity has no effect on the direction of Mid Cap i.e., Mid Cap and Jpmorgan go up and down completely randomly.
Pair Corralation between Mid Cap and Jpmorgan
Assuming the 90 days horizon Mid Cap Growth is expected to generate 1.47 times more return on investment than Jpmorgan. However, Mid Cap is 1.47 times more volatile than Jpmorgan Equity Fund. It trades about 0.49 of its potential returns per unit of risk. Jpmorgan Equity Fund is currently generating about 0.31 per unit of risk. If you would invest 3,663 in Mid Cap Growth on September 4, 2024 and sell it today you would earn a total of 470.00 from holding Mid Cap Growth or generate 12.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.24% |
| Values | Daily Returns |
Mid Cap Growth vs. Jpmorgan Equity Fund
Performance |
| Timeline |
| Mid Cap Growth |
| Jpmorgan Equity |
Mid Cap and Jpmorgan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mid Cap and Jpmorgan
The main advantage of trading using opposite Mid Cap and Jpmorgan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mid Cap position performs unexpectedly, Jpmorgan 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 will offset losses from the drop in Jpmorgan's long position.| Mid Cap vs. Touchstone Sustainability And | Mid Cap vs. Growth Opportunities Fund | Mid Cap vs. Total Return Fund | Mid Cap vs. William Blair International |
| Jpmorgan vs. Sprott Gold Equity | Jpmorgan vs. Fidelity Advisor Gold | Jpmorgan vs. International Investors Gold | Jpmorgan vs. First Eagle Gold |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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