Correlation Between Tidal ETF and JPMorgan Chase

Can any of the company-specific risk be diversified away by investing in both Tidal ETF and JPMorgan Chase 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 Tidal ETF and JPMorgan Chase into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Tidal ETF Trust and JPMorgan Chase Co, you can compare the effects of market volatilities on Tidal ETF and JPMorgan Chase 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 Tidal ETF with a short position of JPMorgan Chase. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tidal ETF and JPMorgan Chase.

Diversification Opportunities for Tidal ETF and JPMorgan Chase

0.71

Correlation Coefficient

Tidal ETF  JPMorgan Chase

Poor diversification

The 3 months correlation between Tidal and JPMorgan is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Tidal ETF Trust and JPMorgan Chase Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JPMorgan Chase and Tidal ETF 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 Tidal ETF Trust are associated (or correlated) with JPMorgan Chase. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JPMorgan Chase has no effect on the direction of Tidal ETF i.e., Tidal ETF and JPMorgan Chase go up and down completely randomly.

Pair Corralation between Tidal ETF and JPMorgan Chase

Given the investment horizon of 90 days Tidal ETF is expected to generate 5.63 times less return on investment than JPMorgan Chase. But when comparing it to its historical volatility, Tidal ETF Trust is 2.81 times less risky than JPMorgan Chase. It trades about 0.05 of its potential returns per unit of risk. JPMorgan Chase Co is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest  12,339  in JPMorgan Chase Co on September 5, 2024 and sell it today you would earn a total of  12,143  from holding JPMorgan Chase Co or generate 98.41% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Tidal ETF Trust  vs.  JPMorgan Chase Co

Tidal ETF Trust

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Tidal ETF Trust are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, Tidal ETF is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

JPMorgan Chase

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in JPMorgan Chase Co are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of very unsteady basic indicators, JPMorgan Chase displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Tidal ETF and JPMorgan Chase

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

The idea behind Tidal ETF Trust and JPMorgan Chase Co 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.

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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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.