Correlation Between JPMorgan Japanese and Hochschild Mining

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

By analyzing existing cross correlation between JPMorgan Japanese Investment and Hochschild Mining plc, you can compare the effects of market volatilities on JPMorgan Japanese and Hochschild Mining 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 Japanese with a short position of Hochschild Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of JPMorgan Japanese and Hochschild Mining.

Diversification Opportunities for JPMorgan Japanese and Hochschild Mining

-0.49

Correlation Coefficient

JPMorgan Japanese  Hochschild Mining

Very good diversification

The 3 months correlation between JPMorgan and Hochschild is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding JPMorgan Japanese Investment and Hochschild Mining plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hochschild Mining plc and JPMorgan Japanese 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 Japanese Investment are associated (or correlated) with Hochschild Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hochschild Mining plc has no effect on the direction of JPMorgan Japanese i.e., JPMorgan Japanese and Hochschild Mining go up and down completely randomly.

Pair Corralation between JPMorgan Japanese and Hochschild Mining

Assuming the 90 days trading horizon JPMorgan Japanese Investment is expected to generate 0.19 times more return on investment than Hochschild Mining. However, JPMorgan Japanese Investment is 5.37 times less risky than Hochschild Mining. It trades about 0.24 of its potential returns per unit of risk. Hochschild Mining plc is currently generating about -0.02 per unit of risk. If you would invest  55,500  in JPMorgan Japanese Investment on April 17, 2025 and sell it today you would earn a total of  6,900  from holding JPMorgan Japanese Investment or generate 12.43% return on investment over 90 days.

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

JPMorgan Japanese Investment  vs.  Hochschild Mining plc

JPMorgan Japanese

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in JPMorgan Japanese Investment are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain technical and fundamental indicators, JPMorgan Japanese may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Hochschild Mining plc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Hochschild Mining plc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound technical and fundamental indicators, Hochschild Mining is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with JPMorgan Japanese and Hochschild Mining

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

The idea behind JPMorgan Japanese Investment and Hochschild Mining plc 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 Valuation module to check real value of public entities based on technical and fundamental data.