Correlation Between Jpmorgan Core and Eaton Vance

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

By analyzing existing cross correlation between Jpmorgan E Bond and Eaton Vance Income, you can compare the effects of market volatilities on Jpmorgan Core and Eaton Vance 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 Core with a short position of Eaton Vance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jpmorgan Core and Eaton Vance.

Diversification Opportunities for Jpmorgan Core and Eaton Vance

0.68

Correlation Coefficient

Jpmorgan Core  Eaton Vance

Poor diversification

The 3 months correlation between Jpmorgan and Eaton is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Jpmorgan E Bond and Eaton Vance Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eaton Vance Income and Jpmorgan Core 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 E Bond are associated (or correlated) with Eaton Vance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eaton Vance Income has no effect on the direction of Jpmorgan Core i.e., Jpmorgan Core and Eaton Vance go up and down completely randomly.

Pair Corralation between Jpmorgan Core and Eaton Vance

Assuming the 90 days horizon Jpmorgan E Bond is expected to generate 1.55 times more return on investment than Eaton Vance. However, Jpmorgan Core is 1.55 times more volatile than Eaton Vance Income. It trades about 0.21 of its potential returns per unit of risk. Eaton Vance Income is currently generating about 0.19 per unit of risk. If you would invest  1,014  in Jpmorgan E Bond on December 1, 2024 and sell it today you would earn a total of  14.00  from holding Jpmorgan E Bond or generate 1.38% return on investment over 90 days.

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

Jpmorgan E Bond  vs.  Eaton Vance Income

Jpmorgan E Bond

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Jpmorgan E Bond are ranked lower than 2 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong fundamental indicators, Jpmorgan Core is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Eaton Vance Income

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Eaton Vance Income are ranked lower than 4 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward indicators, Eaton Vance is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Jpmorgan Core and Eaton Vance

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

The idea behind Jpmorgan E Bond and Eaton Vance Income 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.