Correlation Between JPMorgan Nasdaq and SPDR Bloomberg

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

By analyzing existing cross correlation between JPMorgan Nasdaq Equity and SPDR Bloomberg Emerging, you can compare the effects of market volatilities on JPMorgan Nasdaq and SPDR Bloomberg 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 JPMorgan Nasdaq with a short position of SPDR Bloomberg. Check out your portfolio center. Please also check ongoing floating volatility patterns of JPMorgan Nasdaq and SPDR Bloomberg.

Diversification Opportunities for JPMorgan Nasdaq and SPDR Bloomberg

-0.31

Correlation Coefficient

JPMorgan Nasdaq  SPDR Bloomberg

Very good diversification

The 3 months correlation between JPMorgan and SPDR is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding JPMorgan Nasdaq Equity and SPDR Bloomberg Emerging in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPDR Bloomberg Emerging and JPMorgan Nasdaq 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 JPMorgan Nasdaq Equity are associated (or correlated) with SPDR Bloomberg. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPDR Bloomberg Emerging has no effect on the direction of JPMorgan Nasdaq i.e., JPMorgan Nasdaq and SPDR Bloomberg go up and down completely randomly.

Pair Corralation between JPMorgan Nasdaq and SPDR Bloomberg

Given the investment horizon of 90 days JPMorgan Nasdaq Equity is expected to under-perform the SPDR Bloomberg. In addition to that, JPMorgan Nasdaq is 2.8 times more volatile than SPDR Bloomberg Emerging. It trades about -0.1 of its total potential returns per unit of risk. SPDR Bloomberg Emerging is currently generating about 0.12 per unit of volatility. If you would invest  1,940  in SPDR Bloomberg Emerging on December 30, 2024 and sell it today you would earn a total of  61.00  from holding SPDR Bloomberg Emerging or generate 3.14% return on investment over 90 days.

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

JPMorgan Nasdaq Equity  vs.  SPDR Bloomberg Emerging

JPMorgan Nasdaq Equity

Risk-Adjusted Performance

Very Weak

Over the last 90 days JPMorgan Nasdaq Equity has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest inconsistent 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.

SPDR Bloomberg Emerging

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in SPDR Bloomberg Emerging are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, SPDR Bloomberg is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with JPMorgan Nasdaq and SPDR Bloomberg

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

The idea behind JPMorgan Nasdaq Equity and SPDR Bloomberg Emerging 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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.