Correlation Between Thornburg International and Jpmorgan
Can any of the company-specific risk be diversified away by investing in both Thornburg International 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 Thornburg International and Jpmorgan into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Thornburg International Value and Jpmorgan Equity Fund, you can compare the effects of market volatilities on Thornburg International 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 Thornburg International with a short position of Jpmorgan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thornburg International and Jpmorgan.
Diversification Opportunities for Thornburg International and Jpmorgan
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Thornburg and Jpmorgan is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Thornburg International Value and Jpmorgan Equity Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jpmorgan Equity and Thornburg International 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 Thornburg International Value 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 Thornburg International i.e., Thornburg International and Jpmorgan go up and down completely randomly.
Pair Corralation between Thornburg International and Jpmorgan
Assuming the 90 days horizon Thornburg International is expected to generate 1.31 times less return on investment than Jpmorgan. But when comparing it to its historical volatility, Thornburg International Value is 1.19 times less risky than Jpmorgan. It trades about 0.06 of its potential returns per unit of risk. Jpmorgan Equity Fund is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 2,219 in Jpmorgan Equity Fund on November 3, 2024 and sell it today you would earn a total of 317.00 from holding Jpmorgan Equity Fund or generate 14.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Thornburg International Value vs. Jpmorgan Equity Fund
Performance |
| Timeline |
| Thornburg International |
| Jpmorgan Equity |
Thornburg International and Jpmorgan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thornburg International and Jpmorgan
The main advantage of trading using opposite Thornburg International and Jpmorgan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thornburg International 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.| Thornburg International vs. Jpmorgan Mid Cap | Thornburg International vs. Jpmorgan International Value | Thornburg International vs. Jpmorgan Equity Fund | Thornburg International vs. Jpmorgan High Yield |
| Jpmorgan vs. Jpmorgan International Value | Jpmorgan vs. Jpmorgan Mid Cap | Jpmorgan vs. Jpmorgan Emerging Markets | Jpmorgan vs. Jpmorgan High Yield |
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 Valuation module to check real value of public entities based on technical and fundamental data.
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