Correlation Between Athersys and JPMorgan Chase

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

By analyzing existing cross correlation between Athersys and JPMorgan Chase Co, you can compare the effects of market volatilities on Athersys and JPMorgan Chase 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 Athersys with a short position of JPMorgan Chase. Check out your portfolio center. Please also check ongoing floating volatility patterns of Athersys and JPMorgan Chase.

Diversification Opportunities for Athersys and JPMorgan Chase

-0.39

Correlation Coefficient

Athersys  JPMorgan Chase

Very good diversification

The 3 months correlation between Athersys and JPMorgan is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Athersys and JPMorgan Chase Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JPMorgan Chase and Athersys 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 Athersys are associated (or correlated) with JPMorgan Chase. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JPMorgan Chase has no effect on the direction of Athersys i.e., Athersys and JPMorgan Chase go up and down completely randomly.

Pair Corralation between Athersys and JPMorgan Chase

If you would invest  0.65  in Athersys on January 24, 2024 and sell it today you would earn a total of  0.00  from holding Athersys or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	5.0%
Values	Daily Returns

Athersys  vs.  JPMorgan Chase Co

Athersys

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Athersys has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong technical indicators, Athersys is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

JPMorgan Chase

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in JPMorgan Chase Co are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of very unsteady basic indicators, JPMorgan Chase may actually be approaching a critical reversion point that can send shares even higher in May 2024.

Pair Trading with Athersys and JPMorgan Chase

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

The idea behind Athersys and JPMorgan Chase Co 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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.