Correlation Between ING Groep and JP Morgan

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

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

Diversification Opportunities for ING Groep and JP Morgan

0.89
  Correlation Coefficient
ING Groep NV
JP Morgan Chase

Very poor diversification

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

Pair Corralation between ING Groep and JP Morgan

Considering the 90-day investment horizon ING Groep NV is expected to generate 1.23 times more return on investment than JP Morgan. However, ING Groep is 1.23 times more volatile than JP Morgan Chase. It trades about 0.03 of its potential returns per unit of risk. JP Morgan Chase is currently generating about 0.03 per unit of risk. If you would invest  1,118  in ING Groep NV on September 4, 2021 and sell it today you would earn a total of  259.00  from holding ING Groep NV or generate 23.17% return on investment over 90 days.
Time Period1 Month [change]
DirectionMoves Together 
StrengthStrong
Accuracy100.0%
ValuesDaily Returns

ING Groep NV  vs.  JP Morgan Chase

 Performance (%) 
      Timeline 
ING Groep NV 
ING Groep Performance
0 of 100
Over the last 90 days ING Groep NV has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain rather sound which may send shares a bit higher in January 2022. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

ING Groep Price Channel

JP Morgan Chase 
JP Morgan Performance
0 of 100
Over the last 90 days JP Morgan Chase has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's basic indicators remain relatively steady which may send shares a bit higher in January 2022. The new chaos may also be a sign of medium-term up-swing for the company stakeholders.

JP Morgan Price Channel

ING Groep and JP Morgan Volatility Contrast

 Predicted Return Density 
      Returns 

Pair Trading with ING Groep and JP Morgan

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

ING Groep NV

Pair trading matchups for ING Groep

The idea behind ING Groep NV and JP Morgan Chase 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.

JP Morgan Chase

Pair trading matchups for JP Morgan

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 Money Managers module to screen money managers from public funds and ETFs managed around the world.

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