Correlation Between AMG Advanced and Bank of Georgia
Can any of the company-specific risk be diversified away by investing in both AMG Advanced and Bank of Georgia 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 Bank of Georgia 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 Bank of Georgia, you can compare the effects of market volatilities on AMG Advanced and Bank of Georgia 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 Bank of Georgia. Check out your portfolio center. Please also check ongoing floating volatility patterns of AMG Advanced and Bank of Georgia.
Diversification Opportunities for AMG Advanced and Bank of Georgia
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between AMG and Bank is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding AMG Advanced Metallurgical and Bank of Georgia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank of Georgia 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 Bank of Georgia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank of Georgia has no effect on the direction of AMG Advanced i.e., AMG Advanced and Bank of Georgia go up and down completely randomly.
Pair Corralation between AMG Advanced and Bank of Georgia
Assuming the 90 days trading horizon AMG Advanced is expected to generate 18.89 times less return on investment than Bank of Georgia. In addition to that, AMG Advanced is 1.9 times more volatile than Bank of Georgia. It trades about 0.0 of its total potential returns per unit of risk. Bank of Georgia is currently generating about 0.05 per unit of volatility. If you would invest 466,500 in Bank of Georgia on November 3, 2024 and sell it today you would earn a total of 9,000 from holding Bank of Georgia or generate 1.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AMG Advanced Metallurgical vs. Bank of Georgia
Performance |
| Timeline |
| AMG Advanced Metallu |
| Bank of Georgia |
AMG Advanced and Bank of Georgia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AMG Advanced and Bank of Georgia
The main advantage of trading using opposite AMG Advanced and Bank of Georgia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AMG Advanced position performs unexpectedly, Bank of Georgia 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 Bank of Georgia will offset losses from the drop in Bank of Georgia's long position.| AMG Advanced vs. Heavitree Brewery | AMG Advanced vs. Ebro Foods | AMG Advanced vs. Bell Food Group | AMG Advanced vs. Litigation Capital Management |
| Bank of Georgia vs. XLMedia PLC | Bank of Georgia vs. Verizon Communications | Bank of Georgia vs. Hollywood Bowl Group | Bank of Georgia vs. Catena Media 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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