Correlation Between Jpmorgan Smartretirement and Great-west Lifetime
Can any of the company-specific risk be diversified away by investing in both Jpmorgan Smartretirement and Great-west Lifetime 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 Smartretirement and Great-west Lifetime into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jpmorgan Smartretirement 2035 and Great West Lifetime 2035, you can compare the effects of market volatilities on Jpmorgan Smartretirement and Great-west Lifetime 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 Smartretirement with a short position of Great-west Lifetime. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jpmorgan Smartretirement and Great-west Lifetime.
Diversification Opportunities for Jpmorgan Smartretirement and Great-west Lifetime
0.99 | Correlation Coefficient |
No risk reduction
The 3 months correlation between Jpmorgan and Great-west is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Jpmorgan Smartretirement 2035 and Great West Lifetime 2035 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Great West Lifetime and Jpmorgan Smartretirement 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 Smartretirement 2035 are associated (or correlated) with Great-west Lifetime. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Great West Lifetime has no effect on the direction of Jpmorgan Smartretirement i.e., Jpmorgan Smartretirement and Great-west Lifetime go up and down completely randomly.
Pair Corralation between Jpmorgan Smartretirement and Great-west Lifetime
Assuming the 90 days horizon Jpmorgan Smartretirement 2035 is expected to under-perform the Great-west Lifetime. But the mutual fund apears to be less risky and, when comparing its historical volatility, Jpmorgan Smartretirement 2035 is 1.17 times less risky than Great-west Lifetime. The mutual fund trades about -0.18 of its potential returns per unit of risk. The Great West Lifetime 2035 is currently generating about -0.15 of returns per unit of risk over similar time horizon. If you would invest 1,372 in Great West Lifetime 2035 on January 26, 2024 and sell it today you would lose (27.00) from holding Great West Lifetime 2035 or give up 1.97% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jpmorgan Smartretirement 2035 vs. Great West Lifetime 2035
Performance |
| Timeline |
| Jpmorgan Smartretirement |
| Great West Lifetime |
Jpmorgan Smartretirement and Great-west Lifetime Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jpmorgan Smartretirement and Great-west Lifetime
The main advantage of trading using opposite Jpmorgan Smartretirement and Great-west Lifetime positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jpmorgan Smartretirement position performs unexpectedly, Great-west Lifetime 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 Great-west Lifetime will offset losses from the drop in Great-west Lifetime's long position.The idea behind Jpmorgan Smartretirement 2035 and Great West Lifetime 2035 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.
| Great-west Lifetime vs. Vanguard Target Retirement | Great-west Lifetime vs. American Funds 2035 | Great-west Lifetime vs. Fidelity Freedom 2035 | Great-west Lifetime vs. Fidelity Freedom Index |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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