Correlation Between JPMorgan Chase and Mogul Energy

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

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

Diversification Opportunities for JPMorgan Chase and Mogul Energy

-0.05

Correlation Coefficient

JPMorgan Chase  Mogul Energy

Good diversification

The 3 months correlation between JPMorgan and Mogul is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding JPMorgan Chase Co and Mogul Energy International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mogul Energy Interna and JPMorgan Chase 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 Chase Co are associated (or correlated) with Mogul Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mogul Energy Interna has no effect on the direction of JPMorgan Chase i.e., JPMorgan Chase and Mogul Energy go up and down completely randomly.

Pair Corralation between JPMorgan Chase and Mogul Energy

Considering the 90-day investment horizon JPMorgan Chase Co is expected to generate 0.12 times more return on investment than Mogul Energy. However, JPMorgan Chase Co is 8.18 times less risky than Mogul Energy. It trades about 0.1 of its potential returns per unit of risk. Mogul Energy International is currently generating about -0.02 per unit of risk. If you would invest  13,293  in JPMorgan Chase Co on August 20, 2024 and sell it today you would earn a total of  11,238  from holding JPMorgan Chase Co or generate 84.54% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

JPMorgan Chase Co  vs.  Mogul Energy International

JPMorgan Chase

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in JPMorgan Chase Co are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, JPMorgan Chase displayed solid returns over the last few months and may actually be approaching a breakup point.

Mogul Energy Interna

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Mogul Energy International are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, Mogul Energy showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with JPMorgan Chase and Mogul Energy

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

The idea behind JPMorgan Chase Co and Mogul Energy International 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.