Correlation Between Jpmorgan Smartretirement and Ampleforth

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

By analyzing existing cross correlation between Jpmorgan Smartretirement Blend and Ampleforth, you can compare the effects of market volatilities on Jpmorgan Smartretirement and Ampleforth 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 Ampleforth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jpmorgan Smartretirement and Ampleforth.

Diversification Opportunities for Jpmorgan Smartretirement and Ampleforth

0.4

Correlation Coefficient

Jpmorgan Smartretirement  Ampleforth

Very weak diversification

The 3 months correlation between Jpmorgan and Ampleforth is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Jpmorgan Smartretirement Blend and Ampleforth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ampleforth 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 Blend are associated (or correlated) with Ampleforth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ampleforth has no effect on the direction of Jpmorgan Smartretirement i.e., Jpmorgan Smartretirement and Ampleforth go up and down completely randomly.

Pair Corralation between Jpmorgan Smartretirement and Ampleforth

Assuming the 90 days horizon Jpmorgan Smartretirement is expected to generate 9.5 times less return on investment than Ampleforth. But when comparing it to its historical volatility, Jpmorgan Smartretirement Blend is 9.97 times less risky than Ampleforth. It trades about 0.03 of its potential returns per unit of risk. Ampleforth is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest  122.00  in Ampleforth on January 17, 2024 and sell it today you would lose (26.00) from holding Ampleforth or give up 21.31% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	96.11%
Values	Daily Returns

Jpmorgan Smartretirement Blend  vs.  Ampleforth

Jpmorgan Smartretirement

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Jpmorgan Smartretirement Blend are ranked lower than 10 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong technical and fundamental indicators, Jpmorgan Smartretirement is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Ampleforth

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Ampleforth are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, Ampleforth exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Jpmorgan Smartretirement and Ampleforth

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

The idea behind Jpmorgan Smartretirement Blend and Ampleforth 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.