Correlation Between JPMorgan International and Tidal ETF

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

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

Diversification Opportunities for JPMorgan International and Tidal ETF

0.49

Correlation Coefficient

JPMorgan International  Tidal ETF

Very weak diversification

The 3 months correlation between JPMorgan and Tidal is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding JPMorgan International Growth and Tidal ETF Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tidal ETF Trust and JPMorgan International 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 International Growth are associated (or correlated) with Tidal ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tidal ETF Trust has no effect on the direction of JPMorgan International i.e., JPMorgan International and Tidal ETF go up and down completely randomly.

Pair Corralation between JPMorgan International and Tidal ETF

Considering the 90-day investment horizon JPMorgan International Growth is expected to under-perform the Tidal ETF. But the etf apears to be less risky and, when comparing its historical volatility, JPMorgan International Growth is 1.01 times less risky than Tidal ETF. The etf trades about -0.34 of its potential returns per unit of risk. The Tidal ETF Trust is currently generating about -0.26 of returns per unit of risk over similar time horizon. If you would invest  1,920  in Tidal ETF Trust on October 12, 2024 and sell it today you would lose (75.00) from holding Tidal ETF Trust or give up 3.91% of portfolio value over 90 days.

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

JPMorgan International Growth  vs.  Tidal ETF Trust

JPMorgan International

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days JPMorgan International Growth has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest abnormal performance, the Etf's forward indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the Exchange Traded Fund stockholders.

Tidal ETF Trust

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Tidal ETF Trust has generated negative risk-adjusted returns adding no value to investors with long positions. 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.

Pair Trading with JPMorgan International and Tidal ETF

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

The idea behind JPMorgan International Growth and Tidal ETF Trust 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.