Correlation Between SPDR FTSE and JPMorgan
Can any of the company-specific risk be diversified away by investing in both SPDR FTSE 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 SPDR FTSE and JPMorgan into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SPDR FTSE International and JPMorgan, you can compare the effects of market volatilities on SPDR FTSE 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 SPDR FTSE with a short position of JPMorgan. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPDR FTSE and JPMorgan.
Diversification Opportunities for SPDR FTSE and JPMorgan
Excellent diversification
The 3 months correlation between SPDR and JPMorgan is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding SPDR FTSE International and JPMorgan in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JPMorgan and SPDR FTSE 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 SPDR FTSE International 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 has no effect on the direction of SPDR FTSE i.e., SPDR FTSE and JPMorgan go up and down completely randomly.
Pair Corralation between SPDR FTSE and JPMorgan
Considering the 90-day investment horizon SPDR FTSE is expected to generate 50.0 times less return on investment than JPMorgan. In addition to that, SPDR FTSE is 3.74 times more volatile than JPMorgan. It trades about 0.0 of its total potential returns per unit of risk. JPMorgan is currently generating about 0.14 per unit of volatility. If you would invest 4,500 in JPMorgan on September 3, 2024 and sell it today you would earn a total of 327.00 from holding JPMorgan or generate 7.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 90.97% |
| Values | Daily Returns |
SPDR FTSE International vs. JPMorgan
Performance |
| Timeline |
| SPDR FTSE International |
| JPMorgan |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Weak
SPDR FTSE and JPMorgan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SPDR FTSE and JPMorgan
The main advantage of trading using opposite SPDR FTSE and JPMorgan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPDR FTSE 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.| SPDR FTSE vs. SPDR Bloomberg Emerging | SPDR FTSE vs. Vanguard Emerging Markets | SPDR FTSE vs. SPDR Bloomberg Barclays | SPDR FTSE vs. VanEck JP Morgan |
| JPMorgan vs. JPMorgan Core Plus | JPMorgan vs. JPMorgan BetaBuilders International | JPMorgan vs. JPMorgan BetaBuilders Equity | JPMorgan vs. JPMorgan BetaBuilders Canada |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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