Correlation Between JPMorgan Chase and National Bank

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

Diversification Opportunities for JPMorgan Chase and National Bank

-0.5

Correlation Coefficient

JPMorgan Chase  National Bank

Very good diversification

The 3 months correlation between JPMorgan and National is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding JPMorgan Chase Co and National Bank of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on National Bank 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 National Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of National Bank has no effect on the direction of JPMorgan Chase i.e., JPMorgan Chase and National Bank go up and down completely randomly.

Pair Corralation between JPMorgan Chase and National Bank

Considering the 90-day investment horizon JPMorgan Chase Co is expected to generate 0.39 times more return on investment than National Bank. However, JPMorgan Chase Co is 2.55 times less risky than National Bank. It trades about 0.0 of its potential returns per unit of risk. National Bank of is currently generating about -0.03 per unit of risk. If you would invest  24,381  in JPMorgan Chase Co on October 8, 2024 and sell it today you would lose (53.00) from holding JPMorgan Chase Co or give up 0.22% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	95.0%
Values	Daily Returns

JPMorgan Chase Co  vs.  National Bank of

JPMorgan Chase

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in JPMorgan Chase Co are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of very unsteady basic indicators, JPMorgan Chase displayed solid returns over the last few months and may actually be approaching a breakup point.

National Bank

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in National Bank of are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong basic indicators, National Bank 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 Chase and National Bank

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

The idea behind JPMorgan Chase Co and National Bank of 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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.