Correlation Between Take Two and AMG Advanced
Can any of the company-specific risk be diversified away by investing in both Take Two 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 Take Two and AMG Advanced into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Take Two Interactive Software and AMG Advanced Metallurgical, you can compare the effects of market volatilities on Take Two 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 Take Two with a short position of AMG Advanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of Take Two and AMG Advanced.
Diversification Opportunities for Take Two and AMG Advanced
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Take and AMG is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding Take Two Interactive Software 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 Take Two 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 Take Two Interactive Software 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 Take Two i.e., Take Two and AMG Advanced go up and down completely randomly.
Pair Corralation between Take Two and AMG Advanced
Assuming the 90 days trading horizon Take Two Interactive Software is expected to generate 0.63 times more return on investment than AMG Advanced. However, Take Two Interactive Software is 1.6 times less risky than AMG Advanced. It trades about 0.22 of its potential returns per unit of risk. AMG Advanced Metallurgical is currently generating about 0.05 per unit of risk. If you would invest 18,012 in Take Two Interactive Software on September 13, 2024 and sell it today you would earn a total of 1,016 from holding Take Two Interactive Software or generate 5.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Take Two Interactive Software vs. AMG Advanced Metallurgical
Performance |
| Timeline |
| Take Two Interactive |
| AMG Advanced Metallu |
Take Two and AMG Advanced Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Take Two and AMG Advanced
The main advantage of trading using opposite Take Two and AMG Advanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Take Two 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.| Take Two vs. Aurora Investment Trust | Take Two vs. Bankers Investment Trust | Take Two vs. FC Investment Trust | Take Two vs. Intuitive Investments Group |
| AMG Advanced vs. Jacquet Metal Service | AMG Advanced vs. Edita Food Industries | AMG Advanced vs. Roebuck Food Group | AMG Advanced vs. Golden Metal Resources |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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