Correlation Between AMG Advanced and Amaroq Minerals
Can any of the company-specific risk be diversified away by investing in both AMG Advanced and Amaroq Minerals 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 Amaroq Minerals 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 Amaroq Minerals, you can compare the effects of market volatilities on AMG Advanced and Amaroq Minerals 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 Amaroq Minerals. Check out your portfolio center. Please also check ongoing floating volatility patterns of AMG Advanced and Amaroq Minerals.
Diversification Opportunities for AMG Advanced and Amaroq Minerals
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between AMG and Amaroq is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding AMG Advanced Metallurgical and Amaroq Minerals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amaroq Minerals 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 Amaroq Minerals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amaroq Minerals has no effect on the direction of AMG Advanced i.e., AMG Advanced and Amaroq Minerals go up and down completely randomly.
Pair Corralation between AMG Advanced and Amaroq Minerals
Assuming the 90 days trading horizon AMG Advanced Metallurgical is expected to under-perform the Amaroq Minerals. But the stock apears to be less risky and, when comparing its historical volatility, AMG Advanced Metallurgical is 1.12 times less risky than Amaroq Minerals. The stock trades about -0.02 of its potential returns per unit of risk. The Amaroq Minerals is currently generating about 0.47 of returns per unit of risk over similar time horizon. If you would invest 7,550 in Amaroq Minerals on September 13, 2024 and sell it today you would earn a total of 2,150 from holding Amaroq Minerals or generate 28.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
AMG Advanced Metallurgical vs. Amaroq Minerals
Performance |
| Timeline |
| AMG Advanced Metallu |
| Amaroq Minerals |
AMG Advanced and Amaroq Minerals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AMG Advanced and Amaroq Minerals
The main advantage of trading using opposite AMG Advanced and Amaroq Minerals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AMG Advanced position performs unexpectedly, Amaroq Minerals 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 Amaroq Minerals will offset losses from the drop in Amaroq Minerals' long position.| AMG Advanced vs. Induction Healthcare Group | AMG Advanced vs. Zoom Video Communications | AMG Advanced vs. MyHealthChecked Plc | AMG Advanced vs. United Internet AG |
| Amaroq Minerals vs. Charter Communications Cl | Amaroq Minerals vs. Zoom Video Communications | Amaroq Minerals vs. Wheaton Precious Metals | Amaroq Minerals vs. European Metals Holdings |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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