Correlation Between AMG Advanced and Triad Group
Can any of the company-specific risk be diversified away by investing in both AMG Advanced and Triad Group 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 Triad Group 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 Triad Group PLC, you can compare the effects of market volatilities on AMG Advanced and Triad Group 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 Triad Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of AMG Advanced and Triad Group.
Diversification Opportunities for AMG Advanced and Triad Group
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between AMG and Triad is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding AMG Advanced Metallurgical and Triad Group PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Triad Group PLC 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 Triad Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Triad Group PLC has no effect on the direction of AMG Advanced i.e., AMG Advanced and Triad Group go up and down completely randomly.
Pair Corralation between AMG Advanced and Triad Group
Assuming the 90 days trading horizon AMG Advanced Metallurgical is expected to under-perform the Triad Group. In addition to that, AMG Advanced is 1.03 times more volatile than Triad Group PLC. It trades about -0.03 of its total potential returns per unit of risk. Triad Group PLC is currently generating about 0.11 per unit of volatility. If you would invest 18,864 in Triad Group PLC on November 3, 2024 and sell it today you would earn a total of 16,636 from holding Triad Group PLC or generate 88.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AMG Advanced Metallurgical vs. Triad Group PLC
Performance |
| Timeline |
| AMG Advanced Metallu |
| Triad Group PLC |
AMG Advanced and Triad Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AMG Advanced and Triad Group
The main advantage of trading using opposite AMG Advanced and Triad Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AMG Advanced position performs unexpectedly, Triad Group 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 Triad Group will offset losses from the drop in Triad Group's long position.| AMG Advanced vs. Rheinmetall AG | AMG Advanced vs. Advanced Medical Solutions | AMG Advanced vs. Universal Display Corp | AMG Advanced vs. Empire Metals Limited |
| Triad Group vs. Roper Technologies | Triad Group vs. Zegona Communications Plc | Triad Group vs. Gamma Communications PLC | Triad Group vs. Xeros Technology Group |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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