Correlation Between Jpmorgan High and Shenkman Short

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

By analyzing existing cross correlation between Jpmorgan High Yield and Shenkman Short Duration, you can compare the effects of market volatilities on Jpmorgan High and Shenkman Short 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 High with a short position of Shenkman Short. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jpmorgan High and Shenkman Short.

Diversification Opportunities for Jpmorgan High and Shenkman Short

0.99

Correlation Coefficient

Jpmorgan High  Shenkman Short

No risk reduction

The 3 months correlation between Jpmorgan and Shenkman is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Jpmorgan High Yield and Shenkman Short Duration in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenkman Short Duration and Jpmorgan High 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 High Yield are associated (or correlated) with Shenkman Short. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenkman Short Duration has no effect on the direction of Jpmorgan High i.e., Jpmorgan High and Shenkman Short go up and down completely randomly.

Pair Corralation between Jpmorgan High and Shenkman Short

Assuming the 90 days horizon Jpmorgan High Yield is expected to generate 1.65 times more return on investment than Shenkman Short. However, Jpmorgan High is 1.65 times more volatile than Shenkman Short Duration. It trades about 0.26 of its potential returns per unit of risk. Shenkman Short Duration is currently generating about 0.25 per unit of risk. If you would invest  640.00  in Jpmorgan High Yield on May 7, 2025 and sell it today you would earn a total of  17.00  from holding Jpmorgan High Yield or generate 2.66% return on investment over 90 days.

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

Jpmorgan High Yield  vs.  Shenkman Short Duration

Jpmorgan High Yield

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Jpmorgan High Yield are ranked lower than 20 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Jpmorgan High is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Shenkman Short Duration

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Shenkman Short Duration are ranked lower than 19 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong technical and fundamental indicators, Shenkman Short 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 High and Shenkman Short

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

The idea behind Jpmorgan High Yield and Shenkman Short Duration 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.