Correlation Between JPMorgan Chase and IQ 50

Can any of the company-specific risk be diversified away by investing in both JPMorgan Chase and IQ 50 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 IQ 50 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 IQ 50 Percent, you can compare the effects of market volatilities on JPMorgan Chase and IQ 50 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 IQ 50. Check out your portfolio center. Please also check ongoing floating volatility patterns of JPMorgan Chase and IQ 50.

Diversification Opportunities for JPMorgan Chase and IQ 50

0.71

Correlation Coefficient

JPMorgan Chase  IQ 50

Poor diversification

The 3 months correlation between JPMorgan and HFXI is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding JPMorgan Chase Co and IQ 50 Percent in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IQ 50 Percent 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 IQ 50. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IQ 50 Percent has no effect on the direction of JPMorgan Chase i.e., JPMorgan Chase and IQ 50 go up and down completely randomly.

Pair Corralation between JPMorgan Chase and IQ 50

Considering the 90-day investment horizon JPMorgan Chase Co is expected to generate 1.89 times more return on investment than IQ 50. However, JPMorgan Chase is 1.89 times more volatile than IQ 50 Percent. It trades about 0.12 of its potential returns per unit of risk. IQ 50 Percent is currently generating about 0.08 per unit of risk. If you would invest  12,475  in JPMorgan Chase Co on December 2, 2024 and sell it today you would earn a total of  13,990  from holding JPMorgan Chase Co or generate 112.14% return on investment over 90 days.

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

JPMorgan Chase Co  vs.  IQ 50 Percent

JPMorgan Chase

Risk-Adjusted Performance

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 unsteady basic indicators, JPMorgan Chase may actually be approaching a critical reversion point that can send shares even higher in April 2025.

IQ 50 Percent

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in IQ 50 Percent are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong basic indicators, IQ 50 is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with JPMorgan Chase and IQ 50

The main advantage of trading using opposite JPMorgan Chase and IQ 50 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JPMorgan Chase position performs unexpectedly, IQ 50 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 IQ 50 will offset losses from the drop in IQ 50's long position.

The idea behind JPMorgan Chase Co and IQ 50 Percent 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.