Correlation Between Jpmorgan Smartretirement* and Jpmorgan Ultra

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

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

Diversification Opportunities for Jpmorgan Smartretirement* and Jpmorgan Ultra

0.51

Correlation Coefficient

Jpmorgan Smartretirement*  Jpmorgan Ultra

Very weak diversification

The 3 months correlation between Jpmorgan and Jpmorgan is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Jpmorgan Smartretirement Blend and Jpmorgan Ultra Short Municipal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jpmorgan Ultra Short and Jpmorgan Smartretirement* 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 Smartretirement Blend are associated (or correlated) with Jpmorgan Ultra. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jpmorgan Ultra Short has no effect on the direction of Jpmorgan Smartretirement* i.e., Jpmorgan Smartretirement* and Jpmorgan Ultra go up and down completely randomly.

Pair Corralation between Jpmorgan Smartretirement* and Jpmorgan Ultra

Assuming the 90 days horizon Jpmorgan Smartretirement* is expected to generate 1.78 times less return on investment than Jpmorgan Ultra. In addition to that, Jpmorgan Smartretirement* is 15.03 times more volatile than Jpmorgan Ultra Short Municipal. It trades about 0.01 of its total potential returns per unit of risk. Jpmorgan Ultra Short Municipal is currently generating about 0.32 per unit of volatility. If you would invest  996.00  in Jpmorgan Ultra Short Municipal on November 28, 2024 and sell it today you would earn a total of  7.00  from holding Jpmorgan Ultra Short Municipal or generate 0.7% return on investment over 90 days.

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

Jpmorgan Smartretirement Blend  vs.  Jpmorgan Ultra Short Municipal

Jpmorgan Smartretirement*

Risk-Adjusted Performance

Weak

Over the last 90 days Jpmorgan Smartretirement Blend has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Jpmorgan Smartretirement* is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Jpmorgan Ultra Short

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Jpmorgan Ultra Short Municipal are ranked lower than 25 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Jpmorgan Ultra is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Jpmorgan Smartretirement* and Jpmorgan Ultra

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

The idea behind Jpmorgan Smartretirement Blend and Jpmorgan Ultra Short Municipal 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.