Correlation Between JPMorgan Short and Janus Henderson

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

By analyzing existing cross correlation between JPMorgan Short Duration and Janus Henderson Mortgage Backed, you can compare the effects of market volatilities on JPMorgan Short and Janus Henderson 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 Short with a short position of Janus Henderson. Check out your portfolio center. Please also check ongoing floating volatility patterns of JPMorgan Short and Janus Henderson.

Diversification Opportunities for JPMorgan Short and Janus Henderson

0.18

Correlation Coefficient

JPMorgan Short  Janus Henderson

Average diversification

The 3 months correlation between JPMorgan and Janus is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding JPMorgan Short Duration and Janus Henderson Mortgage Backe in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Janus Henderson Mort and JPMorgan Short 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 Short Duration are associated (or correlated) with Janus Henderson. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Janus Henderson Mort has no effect on the direction of JPMorgan Short i.e., JPMorgan Short and Janus Henderson go up and down completely randomly.

Pair Corralation between JPMorgan Short and Janus Henderson

Given the investment horizon of 90 days JPMorgan Short Duration is expected to generate 0.35 times more return on investment than Janus Henderson. However, JPMorgan Short Duration is 2.87 times less risky than Janus Henderson. It trades about 0.18 of its potential returns per unit of risk. Janus Henderson Mortgage Backed is currently generating about 0.03 per unit of risk. If you would invest  4,657  in JPMorgan Short Duration on October 26, 2024 and sell it today you would earn a total of  19.00  from holding JPMorgan Short Duration or generate 0.41% return on investment over 90 days.

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

JPMorgan Short Duration  vs.  Janus Henderson Mortgage Backe

JPMorgan Short Duration

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in JPMorgan Short Duration are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable fundamental indicators, JPMorgan Short is not utilizing all of its potentials. The newest stock price agitation, may contribute to short-term losses for the retail investors.

Janus Henderson Mort

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Janus Henderson Mortgage Backed has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable fundamental drivers, Janus Henderson is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with JPMorgan Short and Janus Henderson

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

The idea behind JPMorgan Short Duration and Janus Henderson Mortgage Backed 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.