Correlation Between JPMorgan Short and ETF Opportunities

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

Diversification Opportunities for JPMorgan Short and ETF Opportunities

0.88

Correlation Coefficient

JPMorgan Short  ETF Opportunities

Very poor diversification

The 3 months correlation between JPMorgan and ETF is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding JPMorgan Short Duration and ETF Opportunities Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ETF Opportunities Trust 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 ETF Opportunities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ETF Opportunities Trust has no effect on the direction of JPMorgan Short i.e., JPMorgan Short and ETF Opportunities go up and down completely randomly.

Pair Corralation between JPMorgan Short and ETF Opportunities

Given the investment horizon of 90 days JPMorgan Short is expected to generate 2.68 times less return on investment than ETF Opportunities. But when comparing it to its historical volatility, JPMorgan Short Duration is 2.02 times less risky than ETF Opportunities. It trades about 0.06 of its potential returns per unit of risk. ETF Opportunities Trust is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  2,325  in ETF Opportunities Trust on August 30, 2024 and sell it today you would earn a total of  36.00  from holding ETF Opportunities Trust or generate 1.55% return on investment over 90 days.

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

JPMorgan Short Duration  vs.  ETF Opportunities Trust

JPMorgan Short Duration

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in JPMorgan Short Duration are ranked lower than 5 (%) 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.

ETF Opportunities Trust

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in ETF Opportunities Trust are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, ETF Opportunities is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with JPMorgan Short and ETF Opportunities

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

The idea behind JPMorgan Short Duration and ETF Opportunities Trust 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.