Correlation Between Intuitive Machines and JPM P

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

By analyzing existing cross correlation between Intuitive Machines and JPM P J, you can compare the effects of market volatilities on Intuitive Machines and JPM P 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 Intuitive Machines with a short position of JPM P. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intuitive Machines and JPM P.

Diversification Opportunities for Intuitive Machines and JPM P

-0.83

Correlation Coefficient

Intuitive Machines  JPM P

Pay attention - limited upside

The 3 months correlation between Intuitive and JPM is -0.83. Overlapping area represents the amount of risk that can be diversified away by holding Intuitive Machines and JPM P J in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JPM P J and Intuitive Machines 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 Intuitive Machines are associated (or correlated) with JPM P. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JPM P J has no effect on the direction of Intuitive Machines i.e., Intuitive Machines and JPM P go up and down completely randomly.

Pair Corralation between Intuitive Machines and JPM P

Given the investment horizon of 90 days Intuitive Machines is expected to generate 9.91 times more return on investment than JPM P. However, Intuitive Machines is 9.91 times more volatile than JPM P J. It trades about 0.01 of its potential returns per unit of risk. JPM P J is currently generating about -0.37 per unit of risk. If you would invest  1,400  in Intuitive Machines on September 22, 2024 and sell it today you would lose (43.00) from holding Intuitive Machines or give up 3.07% of portfolio value over 90 days.

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

Intuitive Machines  vs.  JPM P J

Intuitive Machines

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Intuitive Machines are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Even with relatively abnormal basic indicators, Intuitive Machines reported solid returns over the last few months and may actually be approaching a breakup point.

JPM P J

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days JPM P J has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest weak performance, the Preferred Stock's forward-looking indicators remain steady and the new chaos on Wall Street may also be a sign of medium-term gains for the company stakeholders.

Pair Trading with Intuitive Machines and JPM P

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

The idea behind Intuitive Machines and JPM P J 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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.