Correlation Between JPMorgan Chase and Restaurant Brands
Can any of the company-specific risk be diversified away by investing in both JPMorgan Chase and Restaurant Brands 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 Chase and Restaurant Brands into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JPMorgan Chase Co and Restaurant Brands International, you can compare the effects of market volatilities on JPMorgan Chase and Restaurant Brands 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 Chase with a short position of Restaurant Brands. Check out your portfolio center. Please also check ongoing floating volatility patterns of JPMorgan Chase and Restaurant Brands.
Diversification Opportunities for JPMorgan Chase and Restaurant Brands
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between JPMorgan and Restaurant is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding JPMorgan Chase Co and Restaurant Brands Internationa in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Restaurant Brands and JPMorgan Chase 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 Chase Co are associated (or correlated) with Restaurant Brands. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Restaurant Brands has no effect on the direction of JPMorgan Chase i.e., JPMorgan Chase and Restaurant Brands go up and down completely randomly.
Pair Corralation between JPMorgan Chase and Restaurant Brands
Assuming the 90 days trading horizon JPMorgan Chase Co is expected to generate 1.32 times more return on investment than Restaurant Brands. However, JPMorgan Chase is 1.32 times more volatile than Restaurant Brands International. It trades about 0.1 of its potential returns per unit of risk. Restaurant Brands International is currently generating about -0.02 per unit of risk. If you would invest 2,563 in JPMorgan Chase Co on October 13, 2024 and sell it today you would earn a total of 621.00 from holding JPMorgan Chase Co or generate 24.23% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
JPMorgan Chase Co vs. Restaurant Brands Internationa
Performance |
Timeline |
JPMorgan Chase |
Restaurant Brands |
JPMorgan Chase and Restaurant Brands Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with JPMorgan Chase and Restaurant Brands
The main advantage of trading using opposite JPMorgan Chase and Restaurant Brands positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JPMorgan Chase position performs unexpectedly, Restaurant Brands 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 Restaurant Brands will offset losses from the drop in Restaurant Brands' long position.JPMorgan Chase vs. Nicola Mining | JPMorgan Chase vs. Postmedia Network Canada | JPMorgan Chase vs. Dream Industrial Real | JPMorgan Chase vs. Overactive Media Corp |
Restaurant Brands vs. CCL Industries | Restaurant Brands vs. Quebecor | Restaurant Brands vs. George Weston 520 | Restaurant Brands vs. Loblaw Companies |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
Other Complementary Tools
Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
Share Portfolio Track or share privately all of your investments from the convenience of any device | |
Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
Fundamental Analysis View fundamental data based on most recent published financial statements |