Correlation Between AMG Advanced and Liontrust Asset
Can any of the company-specific risk be diversified away by investing in both AMG Advanced and Liontrust Asset 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 Liontrust Asset 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 Liontrust Asset Management, you can compare the effects of market volatilities on AMG Advanced and Liontrust Asset 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 Liontrust Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of AMG Advanced and Liontrust Asset.
Diversification Opportunities for AMG Advanced and Liontrust Asset
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between AMG and Liontrust is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding AMG Advanced Metallurgical and Liontrust Asset Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Liontrust Asset Mana 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 Liontrust Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Liontrust Asset Mana has no effect on the direction of AMG Advanced i.e., AMG Advanced and Liontrust Asset go up and down completely randomly.
Pair Corralation between AMG Advanced and Liontrust Asset
Assuming the 90 days trading horizon AMG Advanced Metallurgical is expected to under-perform the Liontrust Asset. But the stock apears to be less risky and, when comparing its historical volatility, AMG Advanced Metallurgical is 1.63 times less risky than Liontrust Asset. The stock trades about -0.12 of its potential returns per unit of risk. The Liontrust Asset Management is currently generating about -0.05 of returns per unit of risk over similar time horizon. If you would invest 47,150 in Liontrust Asset Management on August 24, 2024 and sell it today you would lose (2,050) from holding Liontrust Asset Management or give up 4.35% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AMG Advanced Metallurgical vs. Liontrust Asset Management
Performance |
| Timeline |
| AMG Advanced Metallu |
| Liontrust Asset Mana |
AMG Advanced and Liontrust Asset Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AMG Advanced and Liontrust Asset
The main advantage of trading using opposite AMG Advanced and Liontrust Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AMG Advanced position performs unexpectedly, Liontrust Asset 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 Liontrust Asset will offset losses from the drop in Liontrust Asset'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 |
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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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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