Correlation Between JPM Global and Std Life

Can any of the company-specific risk be diversified away by investing in both JPM Global and Std Life 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 JPM Global and Std Life into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between JPM Global Equity and Std Life UK, you can compare the effects of market volatilities on JPM Global and Std Life 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 JPM Global with a short position of Std Life. Check out your portfolio center. Please also check ongoing floating volatility patterns of JPM Global and Std Life.

Diversification Opportunities for JPM Global and Std Life

0.0

Correlation Coefficient

JPM Global  Std Life

Pay attention - limited upside

The 3 months correlation between JPM and Std is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding JPM Global Equity and Std Life UK in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Std Life UK and JPM Global 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 JPM Global Equity are associated (or correlated) with Std Life. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Std Life UK has no effect on the direction of JPM Global i.e., JPM Global and Std Life go up and down completely randomly.

Pair Corralation between JPM Global and Std Life

If you would invest  396.00  in JPM Global Equity on December 22, 2024 and sell it today you would earn a total of  2.00  from holding JPM Global Equity or generate 0.51% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

JPM Global Equity  vs.  Std Life UK

JPM Global Equity

Risk-Adjusted Performance

Weak

Over the last 90 days JPM Global Equity has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, JPM Global is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Std Life UK

Risk-Adjusted Performance

Very Weak

Over the last 90 days Std Life UK has generated negative risk-adjusted returns adding no value to fund investors. In spite of rather sound basic indicators, Std Life is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with JPM Global and Std Life

The main advantage of trading using opposite JPM Global and Std Life positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JPM Global position performs unexpectedly, Std Life 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 Std Life will offset losses from the drop in Std Life's long position.

The idea behind JPM Global Equity and Std Life UK pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.