Correlation Between Alliancebernstein and Jpmorgan Intrepid

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

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

Diversification Opportunities for Alliancebernstein and Jpmorgan Intrepid

0.62

Correlation Coefficient

Alliancebernstein  Jpmorgan Intrepid

Poor diversification

The 3 months correlation between Alliancebernstein and Jpmorgan is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Alliancebernstein Global Higho and Jpmorgan Intrepid Value in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jpmorgan Intrepid Value and Alliancebernstein 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 Alliancebernstein Global Highome 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 Value has no effect on the direction of Alliancebernstein i.e., Alliancebernstein and Jpmorgan Intrepid go up and down completely randomly.

Pair Corralation between Alliancebernstein and Jpmorgan Intrepid

Assuming the 90 days horizon Alliancebernstein is expected to generate 5.89 times less return on investment than Jpmorgan Intrepid. But when comparing it to its historical volatility, Alliancebernstein Global Highome is 3.37 times less risky than Jpmorgan Intrepid. It trades about 0.11 of its potential returns per unit of risk. Jpmorgan Intrepid Value is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest  3,043  in Jpmorgan Intrepid Value on October 25, 2024 and sell it today you would earn a total of  79.00  from holding Jpmorgan Intrepid Value or generate 2.6% return on investment over 90 days.

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

Alliancebernstein Global Higho  vs.  Jpmorgan Intrepid Value

Alliancebernstein

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Alliancebernstein Global Highome are ranked lower than 1 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong technical and fundamental indicators, Alliancebernstein is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Jpmorgan Intrepid Value

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Jpmorgan Intrepid Value 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 Alliancebernstein and Jpmorgan Intrepid

The main advantage of trading using opposite Alliancebernstein and Jpmorgan Intrepid positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alliancebernstein 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 Alliancebernstein Global Highome and Jpmorgan Intrepid Value 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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.