Correlation Between IQ Candriam and JP Morgan

Can any of the company-specific risk be diversified away by investing in both IQ Candriam and JP Morgan 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 IQ Candriam and JP Morgan into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between IQ Candriam ESG and JP Morgan Exchange Traded, you can compare the effects of market volatilities on IQ Candriam and JP Morgan 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 IQ Candriam with a short position of JP Morgan. Check out your portfolio center. Please also check ongoing floating volatility patterns of IQ Candriam and JP Morgan.

Diversification Opportunities for IQ Candriam and JP Morgan

-0.18

Correlation Coefficient

IQ Candriam  JP Morgan

Good diversification

The 3 months correlation between IQSI and JCTR is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding IQ Candriam ESG and JP Morgan Exchange Traded in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JP Morgan Exchange and IQ Candriam 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 IQ Candriam ESG are associated (or correlated) with JP Morgan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JP Morgan Exchange has no effect on the direction of IQ Candriam i.e., IQ Candriam and JP Morgan go up and down completely randomly.

Pair Corralation between IQ Candriam and JP Morgan

Given the investment horizon of 90 days IQ Candriam ESG is expected to generate 0.8 times more return on investment than JP Morgan. However, IQ Candriam ESG is 1.25 times less risky than JP Morgan. It trades about 0.11 of its potential returns per unit of risk. JP Morgan Exchange Traded is currently generating about -0.11 per unit of risk. If you would invest  2,938  in IQ Candriam ESG on December 17, 2024 and sell it today you would earn a total of  163.00  from holding IQ Candriam ESG or generate 5.55% return on investment over 90 days.

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

IQ Candriam ESG  vs.  JP Morgan Exchange Traded

IQ Candriam ESG

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in IQ Candriam ESG are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong basic indicators, IQ Candriam is not utilizing all of its potentials. The newest stock price confusion, may contribute to short-horizon losses for the traders.

JP Morgan Exchange

Risk-Adjusted Performance

Very Weak

Over the last 90 days JP Morgan Exchange Traded has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest weak performance, the Etf's basic indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the ETF retail investors.

Pair Trading with IQ Candriam and JP Morgan

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

The idea behind IQ Candriam ESG and JP Morgan Exchange Traded 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.