Correlation Between IShares MSCI and Jpmorgan Small

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Can any of the company-specific risk be diversified away by investing in both IShares MSCI and Jpmorgan Small 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 IShares MSCI and Jpmorgan Small into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between IShares MSCI Ireland and Jpmorgan Small Cap, you can compare the effects of market volatilities on IShares MSCI and Jpmorgan Small 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 IShares MSCI with a short position of Jpmorgan Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares MSCI and Jpmorgan Small.

Diversification Opportunities for IShares MSCI and Jpmorgan Small

0.0
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between IShares and Jpmorgan is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding IShares MSCI Ireland and JPMORGAN SMALL CAP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jpmorgan Small Cap and IShares MSCI 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 IShares MSCI Ireland are associated (or correlated) with Jpmorgan Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jpmorgan Small Cap has no effect on the direction of IShares MSCI i.e., IShares MSCI and Jpmorgan Small go up and down completely randomly.

Pair Corralation between IShares MSCI and Jpmorgan Small

If you would invest  6,610  in IShares MSCI Ireland on December 30, 2023 and sell it today you would earn a total of  324.00  from holding IShares MSCI Ireland or generate 4.9% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy0.0%
ValuesDaily Returns

IShares MSCI Ireland  vs.  JPMORGAN SMALL CAP

 Performance 
       Timeline  
IShares MSCI Ireland 

Risk-Adjusted Performance

17 of 100

 
Low
 
High
Good
Compared to the overall equity markets, risk-adjusted returns on investments in IShares MSCI Ireland are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. Despite quite weak basic indicators, IShares MSCI disclosed solid returns over the last few months and may actually be approaching a breakup point.
Jpmorgan Small Cap 

Risk-Adjusted Performance

0 of 100

 
Low
 
High
OK
Over the last 90 days Jpmorgan Small Cap has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Jpmorgan Small is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

IShares MSCI and Jpmorgan Small Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with IShares MSCI and Jpmorgan Small

The main advantage of trading using opposite IShares MSCI and Jpmorgan Small positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares MSCI position performs unexpectedly, Jpmorgan Small 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 Small will offset losses from the drop in Jpmorgan Small's long position.
The idea behind IShares MSCI Ireland and Jpmorgan Small 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 Stocks Directory module to find actively traded stocks across global markets.

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