Correlation Between AMG Advanced and Jacquet Metal
Can any of the company-specific risk be diversified away by investing in both AMG Advanced and Jacquet Metal 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 AMG Advanced and Jacquet Metal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AMG Advanced Metallurgical and Jacquet Metal Service, you can compare the effects of market volatilities on AMG Advanced and Jacquet Metal 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 AMG Advanced with a short position of Jacquet Metal. Check out your portfolio center. Please also check ongoing floating volatility patterns of AMG Advanced and Jacquet Metal.
Diversification Opportunities for AMG Advanced and Jacquet Metal
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between AMG and Jacquet is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding AMG Advanced Metallurgical and Jacquet Metal Service in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jacquet Metal Service and AMG Advanced 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 AMG Advanced Metallurgical are associated (or correlated) with Jacquet Metal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jacquet Metal Service has no effect on the direction of AMG Advanced i.e., AMG Advanced and Jacquet Metal go up and down completely randomly.
Pair Corralation between AMG Advanced and Jacquet Metal
Assuming the 90 days trading horizon AMG Advanced Metallurgical is expected to under-perform the Jacquet Metal. In addition to that, AMG Advanced is 1.58 times more volatile than Jacquet Metal Service. It trades about -0.04 of its total potential returns per unit of risk. Jacquet Metal Service is currently generating about -0.03 per unit of volatility. If you would invest 1,794 in Jacquet Metal Service on August 24, 2024 and sell it today you would lose (226.00) from holding Jacquet Metal Service or give up 12.6% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AMG Advanced Metallurgical vs. Jacquet Metal Service
Performance |
| Timeline |
| AMG Advanced Metallu |
| Jacquet Metal Service |
AMG Advanced and Jacquet Metal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AMG Advanced and Jacquet Metal
The main advantage of trading using opposite AMG Advanced and Jacquet Metal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AMG Advanced position performs unexpectedly, Jacquet Metal 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 Jacquet Metal will offset losses from the drop in Jacquet Metal's long position.| AMG Advanced vs. Quadrise Plc | AMG Advanced vs. Intuitive Investments Group | AMG Advanced vs. European Metals Holdings | AMG Advanced vs. Athelney Trust plc |
| Jacquet Metal vs. Hochschild Mining plc | Jacquet Metal vs. Aeorema Communications Plc | Jacquet Metal vs. Zoom Video Communications | Jacquet Metal vs. MTI Wireless Edge |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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