diversifiable risk of combining Jpmorgan International and Jhancock Disciplined into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jpmorgan International Equity and Jhancock Disciplined Value, you can compare the effects of market volatilities on Jpmorgan International and Jhancock Disciplined 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 International with a short position of Jhancock Disciplined. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jpmorgan International and Jhancock Disciplined.
Diversification Opportunities for Jpmorgan International and Jhancock Disciplined
Pair Corralation between Jpmorgan International and Jhancock Disciplined
Assuming the 90 days horizon Jpmorgan International Equity is expected to generate 1.03 times more return on investment than Jhancock Disciplined. However, Jpmorgan International is 1.03 times more volatile than Jhancock Disciplined Value. It trades about 0.03 of its potential returns per unit of risk. Jhancock Disciplined Value is currently generating about 0.01 per unit of risk. If you would invest 1,699 in Jpmorgan International Equity on November 24, 2023 and sell it today you would earn a total of 203.00 from holding Jpmorgan International Equity or generate 11.95% return on investment over 90 days.
JPMORGAN INTERNATIONAL EQUITY vs. JHancock Disciplined Value
Jpmorgan International and Jhancock Disciplined Volatility Contrast
Pair Trading with Jpmorgan International and Jhancock DisciplinedThe main advantage of trading using opposite Jpmorgan International and Jhancock Disciplined positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jpmorgan International position performs unexpectedly, Jhancock Disciplined 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 Jhancock Disciplined will offset losses from the drop in Jhancock Disciplined's long position. The idea behind Jpmorgan International Equity and Jhancock Disciplined Value 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.
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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