Correlation Between Jpmorgan Mid and Champlain Mid

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

By analyzing existing cross correlation between Jpmorgan Mid Cap and Champlain Mid Cap, you can compare the effects of market volatilities on Jpmorgan Mid and Champlain Mid 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 Mid with a short position of Champlain Mid. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jpmorgan Mid and Champlain Mid.

Diversification Opportunities for Jpmorgan Mid and Champlain Mid

0.89

Correlation Coefficient

Jpmorgan Mid  Champlain Mid

Very poor diversification

The 3 months correlation between Jpmorgan and Champlain is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Jpmorgan Mid Cap and Champlain Mid Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Champlain Mid Cap and Jpmorgan Mid 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 Mid Cap are associated (or correlated) with Champlain Mid. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Champlain Mid Cap has no effect on the direction of Jpmorgan Mid i.e., Jpmorgan Mid and Champlain Mid go up and down completely randomly.

Pair Corralation between Jpmorgan Mid and Champlain Mid

Assuming the 90 days horizon Jpmorgan Mid Cap is expected to generate 0.64 times more return on investment than Champlain Mid. However, Jpmorgan Mid Cap is 1.56 times less risky than Champlain Mid. It trades about -0.17 of its potential returns per unit of risk. Champlain Mid Cap is currently generating about -0.14 per unit of risk. If you would invest  7,071  in Jpmorgan Mid Cap on November 29, 2024 and sell it today you would lose (682.00) from holding Jpmorgan Mid Cap or give up 9.65% of portfolio value over 90 days.

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

Jpmorgan Mid Cap  vs.  Champlain Mid Cap

Jpmorgan Mid Cap

Risk-Adjusted Performance

Very Weak

Over the last 90 days Jpmorgan Mid Cap has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's technical and fundamental indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Champlain Mid Cap

Risk-Adjusted Performance

Very Weak

Over the last 90 days Champlain Mid Cap has generated negative risk-adjusted returns adding no value to fund investors. In spite of weak performance in the last few months, the Fund's primary indicators remain fairly strong which may send shares a bit higher in March 2025. The current disturbance may also be a sign of long term up-swing for the fund investors.

Pair Trading with Jpmorgan Mid and Champlain Mid

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

The idea behind Jpmorgan Mid Cap and Champlain Mid Cap 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.