Correlation Between Templeton Emerging and Jpmorgan Emerging
Can any of the company-specific risk be diversified away by investing in both Templeton Emerging 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 Templeton Emerging and Jpmorgan Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Templeton Emerging Markets and Jpmorgan Emerging Markets, you can compare the effects of market volatilities on Templeton Emerging 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 Templeton Emerging with a short position of Jpmorgan Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Templeton Emerging and Jpmorgan Emerging.
Diversification Opportunities for Templeton Emerging and Jpmorgan Emerging
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Templeton and JPMORGAN is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Templeton Emerging Markets 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 Templeton Emerging 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 Templeton Emerging Markets 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 Templeton Emerging i.e., Templeton Emerging and Jpmorgan Emerging go up and down completely randomly.
Pair Corralation between Templeton Emerging and Jpmorgan Emerging
Assuming the 90 days horizon Templeton Emerging is expected to generate 25.67 times less return on investment than Jpmorgan Emerging. In addition to that, Templeton Emerging is 2.43 times more volatile than Jpmorgan Emerging Markets. It trades about 0.0 of its total potential returns per unit of risk. Jpmorgan Emerging Markets is currently generating about 0.11 per unit of volatility. If you would invest 603.00 in Jpmorgan Emerging Markets on October 26, 2024 and sell it today you would earn a total of 23.00 from holding Jpmorgan Emerging Markets or generate 3.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Templeton Emerging Markets vs. Jpmorgan Emerging Markets
Performance |
| Timeline |
| Templeton Emerging |
| Jpmorgan Emerging Markets |
Templeton Emerging and Jpmorgan Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Templeton Emerging and Jpmorgan Emerging
The main advantage of trading using opposite Templeton Emerging and Jpmorgan Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Templeton Emerging 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.| Templeton Emerging vs. Americafirst Large Cap | Templeton Emerging vs. Avantis Large Cap | Templeton Emerging vs. Dodge Cox Stock | Templeton Emerging vs. Transamerica Large Cap |
| Jpmorgan Emerging vs. Embark Commodity Strategy | Jpmorgan Emerging vs. Calvert Emerging Markets | Jpmorgan Emerging vs. Wasatch Frontier Emerging | Jpmorgan Emerging vs. Templeton Emerging Markets |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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