Correlation Between TSJA and JPMorgan International

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

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

Diversification Opportunities for TSJA and JPMorgan International

-0.34

Correlation Coefficient

TSJA  JPMorgan International

Very good diversification

The 3 months correlation between TSJA and JPMorgan is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding TSJA and JPMorgan International Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JPMorgan International and TSJA 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 TSJA are associated (or correlated) with JPMorgan International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JPMorgan International has no effect on the direction of TSJA i.e., TSJA and JPMorgan International go up and down completely randomly.

Pair Corralation between TSJA and JPMorgan International

If you would invest  6,348  in JPMorgan International Growth on October 26, 2024 and sell it today you would earn a total of  152.00  from holding JPMorgan International Growth or generate 2.39% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	5.56%
Values	Daily Returns

TSJA  vs.  JPMorgan International Growth

TSJA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days TSJA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong forward-looking indicators, TSJA is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

JPMorgan International

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days JPMorgan International Growth has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable forward indicators, JPMorgan International is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with TSJA and JPMorgan International

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

The idea behind TSJA and JPMorgan International 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.