Correlation Between 48126BAA1 and Cumberland Pharmaceuticals
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By analyzing existing cross correlation between JP Morgan Chase and Cumberland Pharmaceuticals, you can compare the effects of market volatilities on 48126BAA1 and Cumberland Pharmaceuticals 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 48126BAA1 with a short position of Cumberland Pharmaceuticals. Check out your portfolio center. Please also check ongoing floating volatility patterns of 48126BAA1 and Cumberland Pharmaceuticals.
Diversification Opportunities for 48126BAA1 and Cumberland Pharmaceuticals
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between 48126BAA1 and Cumberland is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding JP Morgan Chase and Cumberland Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cumberland Pharmaceuticals and 48126BAA1 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 JP Morgan Chase are associated (or correlated) with Cumberland Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cumberland Pharmaceuticals has no effect on the direction of 48126BAA1 i.e., 48126BAA1 and Cumberland Pharmaceuticals go up and down completely randomly.
Pair Corralation between 48126BAA1 and Cumberland Pharmaceuticals
Assuming the 90 days trading horizon JP Morgan Chase is expected to generate 0.24 times more return on investment than Cumberland Pharmaceuticals. However, JP Morgan Chase is 4.24 times less risky than Cumberland Pharmaceuticals. It trades about 0.01 of its potential returns per unit of risk. Cumberland Pharmaceuticals is currently generating about -0.01 per unit of risk. If you would invest 10,101 in JP Morgan Chase on September 4, 2024 and sell it today you would earn a total of 103.00 from holding JP Morgan Chase or generate 1.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.6% |
| Values | Daily Returns |
JP Morgan Chase vs. Cumberland Pharmaceuticals
Performance |
| Timeline |
| JP Morgan Chase |
| Cumberland Pharmaceuticals |
48126BAA1 and Cumberland Pharmaceuticals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 48126BAA1 and Cumberland Pharmaceuticals
The main advantage of trading using opposite 48126BAA1 and Cumberland Pharmaceuticals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 48126BAA1 position performs unexpectedly, Cumberland Pharmaceuticals 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 Cumberland Pharmaceuticals will offset losses from the drop in Cumberland Pharmaceuticals' long position.| 48126BAA1 vs. Cumberland Pharmaceuticals | 48126BAA1 vs. Viemed Healthcare | 48126BAA1 vs. Sonida Senior Living | 48126BAA1 vs. Weyco Group |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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