Correlation Between Jpmorgan Small and Jpmorgan Intrepid

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

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

Diversification Opportunities for Jpmorgan Small and Jpmorgan Intrepid

0.86

Correlation Coefficient

Jpmorgan Small  Jpmorgan Intrepid

Very poor diversification

The 3 months correlation between Jpmorgan and Jpmorgan is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Jpmorgan Small Cap and Jpmorgan Intrepid Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jpmorgan Intrepid Growth and Jpmorgan Small 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 Small Cap are associated (or correlated) with Jpmorgan Intrepid. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jpmorgan Intrepid Growth has no effect on the direction of Jpmorgan Small i.e., Jpmorgan Small and Jpmorgan Intrepid go up and down completely randomly.

Pair Corralation between Jpmorgan Small and Jpmorgan Intrepid

Assuming the 90 days horizon Jpmorgan Small is expected to generate 1.14 times less return on investment than Jpmorgan Intrepid. In addition to that, Jpmorgan Small is 1.37 times more volatile than Jpmorgan Intrepid Growth. It trades about 0.13 of its total potential returns per unit of risk. Jpmorgan Intrepid Growth is currently generating about 0.21 per unit of volatility. If you would invest  8,180  in Jpmorgan Intrepid Growth on September 4, 2024 and sell it today you would earn a total of  1,043  from holding Jpmorgan Intrepid Growth or generate 12.75% return on investment over 90 days.

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

Jpmorgan Small Cap  vs.  Jpmorgan Intrepid Growth

Jpmorgan Small Cap

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Jpmorgan Small Cap are ranked lower than 10 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Jpmorgan Small may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Jpmorgan Intrepid Growth

Risk-Adjusted Performance

16 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Jpmorgan Intrepid Growth are ranked lower than 16 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Jpmorgan Intrepid may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Jpmorgan Small and Jpmorgan Intrepid

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

The idea behind Jpmorgan Small Cap and Jpmorgan Intrepid Growth 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.