Correlation Between AMG Advanced and Amundi Physical
Can any of the company-specific risk be diversified away by investing in both AMG Advanced and Amundi Physical 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 Amundi Physical 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 Amundi Physical Gold, you can compare the effects of market volatilities on AMG Advanced and Amundi Physical 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 Amundi Physical. Check out your portfolio center. Please also check ongoing floating volatility patterns of AMG Advanced and Amundi Physical.
Diversification Opportunities for AMG Advanced and Amundi Physical
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between AMG and Amundi is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding AMG Advanced Metallurgical and Amundi Physical Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amundi Physical Gold 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 Amundi Physical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amundi Physical Gold has no effect on the direction of AMG Advanced i.e., AMG Advanced and Amundi Physical go up and down completely randomly.
Pair Corralation between AMG Advanced and Amundi Physical
Assuming the 90 days trading horizon AMG Advanced Metallurgical is expected to under-perform the Amundi Physical. In addition to that, AMG Advanced is 1.74 times more volatile than Amundi Physical Gold. It trades about -0.21 of its total potential returns per unit of risk. Amundi Physical Gold is currently generating about -0.04 per unit of volatility. If you would invest 841,175 in Amundi Physical Gold on September 2, 2024 and sell it today you would lose (9,650) from holding Amundi Physical Gold or give up 1.15% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
AMG Advanced Metallurgical vs. Amundi Physical Gold
Performance |
| Timeline |
| AMG Advanced Metallu |
| Amundi Physical Gold |
AMG Advanced and Amundi Physical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AMG Advanced and Amundi Physical
The main advantage of trading using opposite AMG Advanced and Amundi Physical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AMG Advanced position performs unexpectedly, Amundi Physical 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 Amundi Physical will offset losses from the drop in Amundi Physical's long position.| AMG Advanced vs. Uniper SE | AMG Advanced vs. Mulberry Group PLC | AMG Advanced vs. London Security Plc | AMG Advanced vs. Triad Group PLC |
| Amundi Physical vs. GreenX Metals | Amundi Physical vs. European Metals Holdings | Amundi Physical vs. Allianz Technology Trust | Amundi Physical vs. Check Point Software |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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