Correlation Between JPMorgan Chase and Seabridge Gold

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

Diversification Opportunities for JPMorgan Chase and Seabridge Gold

-0.47

Correlation Coefficient

JPMorgan Chase  Seabridge Gold

Very good diversification

The 3 months correlation between JPMorgan and Seabridge is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding JPMorgan Chase Co and Seabridge Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Seabridge Gold 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 Seabridge Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Seabridge Gold has no effect on the direction of JPMorgan Chase i.e., JPMorgan Chase and Seabridge Gold go up and down completely randomly.

Pair Corralation between JPMorgan Chase and Seabridge Gold

Assuming the 90 days trading horizon JPMorgan Chase Co is expected to generate 0.74 times more return on investment than Seabridge Gold. However, JPMorgan Chase Co is 1.35 times less risky than Seabridge Gold. It trades about 0.11 of its potential returns per unit of risk. Seabridge Gold is currently generating about -0.04 per unit of risk. If you would invest  2,922  in JPMorgan Chase Co on September 3, 2024 and sell it today you would earn a total of  422.00  from holding JPMorgan Chase Co or generate 14.44% return on investment over 90 days.

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

JPMorgan Chase Co  vs.  Seabridge Gold

JPMorgan Chase

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in JPMorgan Chase Co are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of very weak basic indicators, JPMorgan Chase displayed solid returns over the last few months and may actually be approaching a breakup point.

Seabridge Gold

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Seabridge Gold has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unfluctuating performance, the Stock's basic indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

Pair Trading with JPMorgan Chase and Seabridge Gold

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

The idea behind JPMorgan Chase Co and Seabridge Gold 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..