Correlation Between JP Morgan and Guinness Atkinson

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

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

Diversification Opportunities for JP Morgan and Guinness Atkinson

0.0

Correlation Coefficient

JP Morgan  Guinness Atkinson

Pay attention - limited upside

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

Pair Corralation between JP Morgan and Guinness Atkinson

If you would invest (100.00) in Guinness Atkinson Asset on December 19, 2024 and sell it today you would earn a total of  100.00  from holding Guinness Atkinson Asset or generate -100.0% return on investment over 90 days.

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

JP Morgan Exchange Traded  vs.  Guinness Atkinson Asset

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 relatively invariable basic indicators, JP Morgan is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Guinness Atkinson Asset

Risk-Adjusted Performance

Very Weak

Over the last 90 days Guinness Atkinson Asset has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Guinness Atkinson is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with JP Morgan and Guinness Atkinson

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

The idea behind JP Morgan Exchange Traded and Guinness Atkinson Asset 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.