Correlation Between JPMorgan International and KFA Mount
Can any of the company-specific risk be diversified away by investing in both JPMorgan International and KFA Mount 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 International and KFA Mount into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JPMorgan International Value and KFA Mount Lucas, you can compare the effects of market volatilities on JPMorgan International and KFA Mount 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 International with a short position of KFA Mount. Check out your portfolio center. Please also check ongoing floating volatility patterns of JPMorgan International and KFA Mount.
Diversification Opportunities for JPMorgan International and KFA Mount
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between JPMorgan and KFA is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding JPMorgan International Value and KFA Mount Lucas in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KFA Mount Lucas and JPMorgan International 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 International Value are associated (or correlated) with KFA Mount. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KFA Mount Lucas has no effect on the direction of JPMorgan International i.e., JPMorgan International and KFA Mount go up and down completely randomly.
Pair Corralation between JPMorgan International and KFA Mount
Given the investment horizon of 90 days JPMorgan International Value is expected to generate 1.37 times more return on investment than KFA Mount. However, JPMorgan International is 1.37 times more volatile than KFA Mount Lucas. It trades about 0.09 of its potential returns per unit of risk. KFA Mount Lucas is currently generating about -0.05 per unit of risk. If you would invest 4,706 in JPMorgan International Value on March 25, 2025 and sell it today you would earn a total of 1,982 from holding JPMorgan International Value or generate 42.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 89.9% |
| Values | Daily Returns |
JPMorgan International Value vs. KFA Mount Lucas
Performance |
| Timeline |
| JPMorgan International |
| KFA Mount Lucas |
JPMorgan International and KFA Mount Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JPMorgan International and KFA Mount
The main advantage of trading using opposite JPMorgan International and KFA Mount positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JPMorgan International position performs unexpectedly, KFA Mount 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 KFA Mount will offset losses from the drop in KFA Mount's long position.| JPMorgan International vs. Strategy Shares | JPMorgan International vs. Freedom Day Dividend | JPMorgan International vs. First Trust Horizon | JPMorgan International vs. Davis Select International |
| KFA Mount vs. iMGP DBi Managed | KFA Mount vs. Simplify Exchange Traded | KFA Mount vs. Simplify Interest Rate | KFA Mount vs. AGFiQ Market Neutral |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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