Correlation Between UBS Money and JPM America

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

By analyzing existing cross correlation between UBS Money Market and JPM America Equity, you can compare the effects of market volatilities on UBS Money and JPM America 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 UBS Money with a short position of JPM America. Check out your portfolio center. Please also check ongoing floating volatility patterns of UBS Money and JPM America.

Diversification Opportunities for UBS Money and JPM America

0.0

Correlation Coefficient

UBS Money  JPM America

Pay attention - limited upside

The 3 months correlation between UBS and JPM is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding UBS Money Market and JPM America Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JPM America Equity and UBS Money 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 UBS Money Market are associated (or correlated) with JPM America. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JPM America Equity has no effect on the direction of UBS Money i.e., UBS Money and JPM America go up and down completely randomly.

Pair Corralation between UBS Money and JPM America

If you would invest  39,619  in JPM America Equity on October 8, 2024 and sell it today you would earn a total of  4,772  from holding JPM America Equity or generate 12.04% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

UBS Money Market  vs.  JPM America Equity

UBS Money Market

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days UBS Money Market has generated negative risk-adjusted returns adding no value to fund investors. Despite somewhat strong fundamental indicators, UBS Money is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

JPM America Equity

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in JPM America Equity are ranked lower than 14 (%) of all funds and portfolios of funds over the last 90 days. In spite of rather unsteady technical and fundamental indicators, JPM America exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with UBS Money and JPM America

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

The idea behind UBS Money Market and JPM America Equity 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.