Correlation Between Jpmorgan Strategic and Spectrum Unconstrained

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

By analyzing existing cross correlation between Jpmorgan Strategic Income and Spectrum Unconstrained, you can compare the effects of market volatilities on Jpmorgan Strategic and Spectrum Unconstrained 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 Strategic with a short position of Spectrum Unconstrained. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jpmorgan Strategic and Spectrum Unconstrained.

Diversification Opportunities for Jpmorgan Strategic and Spectrum Unconstrained

0.94

Correlation Coefficient

Jpmorgan Strategic  Spectrum Unconstrained

Almost no diversification

The 3 months correlation between Jpmorgan and Spectrum is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Jpmorgan Strategic Income and Spectrum Unconstrained in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Spectrum Unconstrained and Jpmorgan Strategic 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 Strategic Income are associated (or correlated) with Spectrum Unconstrained. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Spectrum Unconstrained has no effect on the direction of Jpmorgan Strategic i.e., Jpmorgan Strategic and Spectrum Unconstrained go up and down completely randomly.

Pair Corralation between Jpmorgan Strategic and Spectrum Unconstrained

Assuming the 90 days horizon Jpmorgan Strategic is expected to generate 5.19 times less return on investment than Spectrum Unconstrained. But when comparing it to its historical volatility, Jpmorgan Strategic Income is 3.85 times less risky than Spectrum Unconstrained. It trades about 0.2 of its potential returns per unit of risk. Spectrum Unconstrained is currently generating about 0.27 of returns per unit of risk over similar time horizon. If you would invest  1,880  in Spectrum Unconstrained on May 1, 2025 and sell it today you would earn a total of  78.00  from holding Spectrum Unconstrained or generate 4.15% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	100.0%
Values	Daily Returns

Jpmorgan Strategic Income  vs.  Spectrum Unconstrained

Jpmorgan Strategic Income

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Jpmorgan Strategic Income are ranked lower than 16 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Jpmorgan Strategic is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Spectrum Unconstrained

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Spectrum Unconstrained are ranked lower than 21 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong fundamental drivers, Spectrum Unconstrained is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Jpmorgan Strategic and Spectrum Unconstrained

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

The idea behind Jpmorgan Strategic Income and Spectrum Unconstrained 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.