Correlation Between AMG Advanced and Public Storage
Can any of the company-specific risk be diversified away by investing in both AMG Advanced and Public Storage 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 Public Storage 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 Public Storage, you can compare the effects of market volatilities on AMG Advanced and Public Storage 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 Public Storage. Check out your portfolio center. Please also check ongoing floating volatility patterns of AMG Advanced and Public Storage.
Diversification Opportunities for AMG Advanced and Public Storage
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between AMG and Public is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding AMG Advanced Metallurgical and Public Storage in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Public Storage 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 Public Storage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Public Storage has no effect on the direction of AMG Advanced i.e., AMG Advanced and Public Storage go up and down completely randomly.
Pair Corralation between AMG Advanced and Public Storage
Assuming the 90 days trading horizon AMG Advanced Metallurgical is expected to under-perform the Public Storage. In addition to that, AMG Advanced is 1.66 times more volatile than Public Storage. It trades about -0.07 of its total potential returns per unit of risk. Public Storage is currently generating about 0.1 per unit of volatility. If you would invest 27,287 in Public Storage on September 1, 2024 and sell it today you would earn a total of 7,776 from holding Public Storage or generate 28.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.47% |
| Values | Daily Returns |
AMG Advanced Metallurgical vs. Public Storage
Performance |
| Timeline |
| AMG Advanced Metallu |
| Public Storage |
AMG Advanced and Public Storage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AMG Advanced and Public Storage
The main advantage of trading using opposite AMG Advanced and Public Storage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AMG Advanced position performs unexpectedly, Public Storage 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 Public Storage will offset losses from the drop in Public Storage's long position.| AMG Advanced vs. DXC Technology Co | AMG Advanced vs. Uber Technologies | AMG Advanced vs. Science in Sport | AMG Advanced vs. Finnair Oyj |
| Public Storage vs. Uniper SE | Public Storage vs. Mulberry Group PLC | Public Storage vs. London Security Plc | Public Storage vs. Triad Group PLC |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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