Correlation Between Visa and Jpmorgan Intrepid

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

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

Diversification Opportunities for Visa and Jpmorgan Intrepid

0.4

Correlation Coefficient

Visa  Jpmorgan Intrepid

Very weak diversification

The 3 months correlation between Visa and Jpmorgan is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Visa Class A 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 Visa 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 Visa Class A 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 Visa i.e., Visa and Jpmorgan Intrepid go up and down completely randomly.

Pair Corralation between Visa and Jpmorgan Intrepid

Taking into account the 90-day investment horizon Visa is expected to generate 1.51 times less return on investment than Jpmorgan Intrepid. But when comparing it to its historical volatility, Visa Class A is 1.04 times less risky than Jpmorgan Intrepid. It trades about 0.08 of its potential returns per unit of risk. Jpmorgan Intrepid Growth is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest  4,846  in Jpmorgan Intrepid Growth on October 10, 2024 and sell it today you would earn a total of  3,627  from holding Jpmorgan Intrepid Growth or generate 74.85% return on investment over 90 days.

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

Visa Class A  vs.  Jpmorgan Intrepid Growth

Visa Class A

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Visa Class A are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, Visa may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Jpmorgan Intrepid Growth

Risk-Adjusted Performance

0 of 100

Weak

Over the last 90 days Jpmorgan Intrepid Growth has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Jpmorgan Intrepid is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Visa and Jpmorgan Intrepid

The main advantage of trading using opposite Visa and Jpmorgan Intrepid positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Visa 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 Visa Class A 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.