Correlation Between Artisan Small and Jpmorgan Large

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

By analyzing existing cross correlation between Artisan Small Cap and Jpmorgan Large Cap, you can compare the effects of market volatilities on Artisan Small and Jpmorgan Large 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 Artisan Small with a short position of Jpmorgan Large. Check out your portfolio center. Please also check ongoing floating volatility patterns of Artisan Small and Jpmorgan Large.

Diversification Opportunities for Artisan Small and Jpmorgan Large

0.89

Correlation Coefficient

Artisan Small  Jpmorgan Large

Very poor diversification

The 3 months correlation between Artisan and Jpmorgan is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Artisan Small Cap and Jpmorgan Large Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jpmorgan Large Cap and Artisan Small 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 Artisan Small Cap are associated (or correlated) with Jpmorgan Large. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jpmorgan Large Cap has no effect on the direction of Artisan Small i.e., Artisan Small and Jpmorgan Large go up and down completely randomly.

Pair Corralation between Artisan Small and Jpmorgan Large

Assuming the 90 days horizon Artisan Small Cap is expected to under-perform the Jpmorgan Large. In addition to that, Artisan Small is 2.21 times more volatile than Jpmorgan Large Cap. It trades about -0.14 of its total potential returns per unit of risk. Jpmorgan Large Cap is currently generating about 0.1 per unit of volatility. If you would invest  8,087  in Jpmorgan Large Cap on September 12, 2024 and sell it today you would earn a total of  138.00  from holding Jpmorgan Large Cap or generate 1.71% return on investment over 90 days.

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

Artisan Small Cap  vs.  Jpmorgan Large Cap

Artisan Small Cap

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Artisan Small Cap are ranked lower than 7 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Artisan Small may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Jpmorgan Large Cap

Risk-Adjusted Performance

14 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Jpmorgan Large Cap are ranked lower than 14 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak technical and fundamental indicators, Jpmorgan Large may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Artisan Small and Jpmorgan Large

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

The idea behind Artisan Small Cap and Jpmorgan Large Cap 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.