Correlation Between Litman Gregory and Jpmorgan Government
Can any of the company-specific risk be diversified away by investing in both Litman Gregory and Jpmorgan Government 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 Litman Gregory and Jpmorgan Government into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Litman Gregory Masters and Jpmorgan Government Bond, you can compare the effects of market volatilities on Litman Gregory and Jpmorgan Government 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 Litman Gregory with a short position of Jpmorgan Government. Check out your portfolio center. Please also check ongoing floating volatility patterns of Litman Gregory and Jpmorgan Government.
Diversification Opportunities for Litman Gregory and Jpmorgan Government
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Litman and Jpmorgan is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Litman Gregory Masters and Jpmorgan Government Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jpmorgan Government Bond and Litman Gregory 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 Litman Gregory Masters are associated (or correlated) with Jpmorgan Government. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jpmorgan Government Bond has no effect on the direction of Litman Gregory i.e., Litman Gregory and Jpmorgan Government go up and down completely randomly.
Pair Corralation between Litman Gregory and Jpmorgan Government
Assuming the 90 days horizon Litman Gregory Masters is expected to generate 3.49 times more return on investment than Jpmorgan Government. However, Litman Gregory is 3.49 times more volatile than Jpmorgan Government Bond. It trades about 0.06 of its potential returns per unit of risk. Jpmorgan Government Bond is currently generating about 0.2 per unit of risk. If you would invest 2,060 in Litman Gregory Masters on June 11, 2025 and sell it today you would earn a total of 66.00 from holding Litman Gregory Masters or generate 3.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Litman Gregory Masters vs. Jpmorgan Government Bond
Performance |
| Timeline |
| Litman Gregory Masters |
| Jpmorgan Government Bond |
Litman Gregory and Jpmorgan Government Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Litman Gregory and Jpmorgan Government
The main advantage of trading using opposite Litman Gregory and Jpmorgan Government positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Litman Gregory position performs unexpectedly, Jpmorgan Government 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 Government will offset losses from the drop in Jpmorgan Government's long position.| Litman Gregory vs. Ab Municipal Bond | Litman Gregory vs. Bbh Intermediate Municipal | Litman Gregory vs. Prudential California Muni | Litman Gregory vs. Transamerica Intermediate Muni |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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