Correlation Between JPMorgan Ultra and BlackRock

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

By analyzing existing cross correlation between JPMorgan Ultra Short Municipal and BlackRock, you can compare the effects of market volatilities on JPMorgan Ultra and BlackRock 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 Ultra with a short position of BlackRock. Check out your portfolio center. Please also check ongoing floating volatility patterns of JPMorgan Ultra and BlackRock.

Diversification Opportunities for JPMorgan Ultra and BlackRock

0.0

Correlation Coefficient

JPMorgan Ultra  BlackRock

Pay attention - limited upside

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

Pair Corralation between JPMorgan Ultra and BlackRock

If you would invest  5,040  in JPMorgan Ultra Short Municipal on December 23, 2024 and sell it today you would earn a total of  43.00  from holding JPMorgan Ultra Short Municipal or generate 0.85% return on investment over 90 days.

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

JPMorgan Ultra Short Municipal  vs.  BlackRock

JPMorgan Ultra Short

Risk-Adjusted Performance

Very Strong

Compared to the overall equity markets, risk-adjusted returns on investments in JPMorgan Ultra Short Municipal are ranked lower than 31 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, JPMorgan Ultra is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

BlackRock

Risk-Adjusted Performance

Very Weak

Over the last 90 days BlackRock has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, BlackRock 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 Ultra and BlackRock

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

The idea behind JPMorgan Ultra Short Municipal and BlackRock 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.

Check out your portfolio center.

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.