Correlation Between Agilent Technologies and JP Morgan

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Can any of the company-specific risk be diversified away by investing in both Agilent Technologies and JP Morgan 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 Agilent Technologies and JP Morgan into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Agilent Technologies and JP Morgan Chase, you can compare the effects of market volatilities on Agilent Technologies and JP Morgan 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 Agilent Technologies with a short position of JP Morgan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Agilent Technologies and JP Morgan.

Diversification Opportunities for Agilent Technologies and JP Morgan

0.9
  Correlation Coefficient

Almost no diversification

The 24 months correlation between Agilent and JP Morgan is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Agilent Technologies and JP Morgan Chase in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JP Morgan Chase and Agilent Technologies 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 Agilent Technologies are associated (or correlated) with JP Morgan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JP Morgan Chase has no effect on the direction of Agilent Technologies i.e., Agilent Technologies and JP Morgan go up and down completely randomly.

Pair Corralation between Agilent Technologies and JP Morgan

Taking into account the 90-day investment horizon Agilent Technologies is expected to generate 1.05 times more return on investment than JP Morgan. However, Agilent Technologies is 1.05 times more volatile than JP Morgan Chase. It trades about -0.18 of its potential returns per unit of risk. JP Morgan Chase is currently generating about -0.35 per unit of risk. If you would invest  12,826  in Agilent Technologies on April 4, 2022 and sell it today you would lose (905.00)  from holding Agilent Technologies or give up 7.06% of portfolio value over 90 days.
Time Period24 Months [change]
DirectionMoves Together 
StrengthVery Strong
Accuracy100.0%
ValuesDaily Returns

Agilent Technologies  vs.  JP Morgan Chase

 Performance (%) 
      Timeline 
Agilent Technologies 
Agilent Performance
3 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Agilent Technologies are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Agilent Technologies is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Structure and Payout Changes

Forward Annual Dividend Yield
0.007
Payout Ratio
0.18
Last Split Factor
1398:1000
Forward Annual Dividend Rate
0.84
Dividend Date
2022-07-27
Ex Dividend Date
2022-07-01
Last Split Date
2014-11-03

Agilent Price Channel

JP Morgan Chase 
JP Morgan Performance
2 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in JP Morgan Chase are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Even with relatively steady basic indicators, JP Morgan is not utilizing all of its potentials. The latest stock price chaos, may contribute to medium-term losses for the stakeholders.

Structure and Payout Changes

Forward Annual Dividend Yield
0.0351
Payout Ratio
0.3
Last Split Factor
3:2
Forward Annual Dividend Rate
4.0
Dividend Date
2022-07-31
Ex Dividend Date
2022-07-05
Last Split Date
2000-06-12

JP Morgan Price Channel

Agilent Technologies and JP Morgan Volatility Contrast

 Predicted Return Density 
      Returns 

Pair Trading with Agilent Technologies and JP Morgan

The main advantage of trading using opposite Agilent Technologies and JP Morgan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Agilent Technologies position performs unexpectedly, JP Morgan 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 JP Morgan will offset losses from the drop in JP Morgan's long position.
The idea behind Agilent Technologies and JP Morgan Chase 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 Price Transformation module to use Price Transformation models to analyze depth of different equity instruments across global markets.

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