Correlation Between JP Morgan and JPMorgan Market

Can any of the company-specific risk be diversified away by investing in both JP Morgan and JPMorgan Market 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 JPMorgan Market 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 JPMorgan Market Expansion, you can compare the effects of market volatilities on JP Morgan and JPMorgan Market 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 JPMorgan Market. Check out your portfolio center. Please also check ongoing floating volatility patterns of JP Morgan and JPMorgan Market.

Diversification Opportunities for JP Morgan and JPMorgan Market

-0.58

Correlation Coefficient

JP Morgan  JPMorgan Market

Excellent diversification

The 3 months correlation between JIRE and JPMorgan is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding JP Morgan Exchange Traded and JPMorgan Market Expansion in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JPMorgan Market Expansion 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 JPMorgan Market. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JPMorgan Market Expansion has no effect on the direction of JP Morgan i.e., JP Morgan and JPMorgan Market go up and down completely randomly.

Pair Corralation between JP Morgan and JPMorgan Market

Given the investment horizon of 90 days JP Morgan Exchange Traded is expected to generate 0.78 times more return on investment than JPMorgan Market. However, JP Morgan Exchange Traded is 1.29 times less risky than JPMorgan Market. It trades about 0.19 of its potential returns per unit of risk. JPMorgan Market Expansion is currently generating about -0.11 per unit of risk. If you would invest  5,846  in JP Morgan Exchange Traded on December 28, 2024 and sell it today you would earn a total of  594.00  from holding JP Morgan Exchange Traded or generate 10.16% return on investment over 90 days.

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

JP Morgan Exchange Traded  vs.  JPMorgan Market Expansion

JP Morgan Exchange

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in JP Morgan Exchange Traded are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, JP Morgan may actually be approaching a critical reversion point that can send shares even higher in April 2025.

JPMorgan Market Expansion

Risk-Adjusted Performance

Very Weak

Over the last 90 days JPMorgan Market Expansion has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Etf's technical and fundamental indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the fund shareholders.

Pair Trading with JP Morgan and JPMorgan Market

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

The idea behind JP Morgan Exchange Traded and JPMorgan Market Expansion 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.