Correlation Between JPMorgan Short and Mairs Power

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

Diversification Opportunities for JPMorgan Short and Mairs Power

0.51

Correlation Coefficient

JPMorgan Short  Mairs Power

Very weak diversification

The 3 months correlation between JPMorgan and Mairs is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding JPMorgan Short Duration and Mairs Power Minnesota in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mairs Power Minnesota 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 Mairs Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mairs Power Minnesota has no effect on the direction of JPMorgan Short i.e., JPMorgan Short and Mairs Power go up and down completely randomly.

Pair Corralation between JPMorgan Short and Mairs Power

Given the investment horizon of 90 days JPMorgan Short Duration is expected to generate 0.48 times more return on investment than Mairs Power. However, JPMorgan Short Duration is 2.09 times less risky than Mairs Power. It trades about -0.04 of its potential returns per unit of risk. Mairs Power Minnesota is currently generating about -0.48 per unit of risk. If you would invest  4,667  in JPMorgan Short Duration on October 11, 2024 and sell it today you would lose (5.00) from holding JPMorgan Short Duration or give up 0.11% of portfolio value over 90 days.

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

JPMorgan Short Duration  vs.  Mairs Power Minnesota

JPMorgan Short Duration

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in JPMorgan Short Duration are ranked lower than 1 (%) 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.

Mairs Power Minnesota

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Mairs Power Minnesota has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Mairs Power is not utilizing all of its potentials. The newest stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with JPMorgan Short and Mairs Power

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

The idea behind JPMorgan Short Duration and Mairs Power Minnesota 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 Stocks Directory module to find actively traded stocks across global markets.