Correlation Between Kroger and AMG Advanced
Can any of the company-specific risk be diversified away by investing in both Kroger and AMG Advanced 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 Kroger and AMG Advanced into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kroger Co and AMG Advanced Metallurgical, you can compare the effects of market volatilities on Kroger and AMG Advanced 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 Kroger with a short position of AMG Advanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kroger and AMG Advanced.
Diversification Opportunities for Kroger and AMG Advanced
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between Kroger and AMG is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Kroger Co and AMG Advanced Metallurgical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AMG Advanced Metallu and Kroger 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 Kroger Co are associated (or correlated) with AMG Advanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AMG Advanced Metallu has no effect on the direction of Kroger i.e., Kroger and AMG Advanced go up and down completely randomly.
Pair Corralation between Kroger and AMG Advanced
Assuming the 90 days trading horizon Kroger Co is expected to generate 0.53 times more return on investment than AMG Advanced. However, Kroger Co is 1.9 times less risky than AMG Advanced. It trades about 0.07 of its potential returns per unit of risk. AMG Advanced Metallurgical is currently generating about -0.11 per unit of risk. If you would invest 4,400 in Kroger Co on August 31, 2024 and sell it today you would earn a total of 1,666 from holding Kroger Co or generate 37.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 98.68% |
| Values | Daily Returns |
Kroger Co vs. AMG Advanced Metallurgical
Performance |
| Timeline |
| Kroger |
| AMG Advanced Metallu |
Kroger and AMG Advanced Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kroger and AMG Advanced
The main advantage of trading using opposite Kroger and AMG Advanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kroger position performs unexpectedly, AMG Advanced 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 AMG Advanced will offset losses from the drop in AMG Advanced's long position.| Kroger vs. Dentsply Sirona | Kroger vs. Seche Environnement SA | Kroger vs. TR Property Investment | Kroger vs. Games Workshop Group |
| AMG Advanced vs. Neometals | AMG Advanced vs. Coor Service Management | AMG Advanced vs. Aeorema Communications Plc | AMG Advanced vs. JLEN Environmental Assets |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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