Correlation Between Axway Software and AMG Advanced
Can any of the company-specific risk be diversified away by investing in both Axway Software and AMG Advanced 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 Axway Software and AMG Advanced into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Axway Software SA and AMG Advanced Metallurgical, you can compare the effects of market volatilities on Axway Software and AMG Advanced 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 Axway Software with a short position of AMG Advanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of Axway Software and AMG Advanced.
Diversification Opportunities for Axway Software and AMG Advanced
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Axway and AMG is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Axway Software SA and AMG Advanced Metallurgical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AMG Advanced Metallu and Axway Software 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 Axway Software SA are associated (or correlated) with AMG Advanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AMG Advanced Metallu has no effect on the direction of Axway Software i.e., Axway Software and AMG Advanced go up and down completely randomly.
Pair Corralation between Axway Software and AMG Advanced
Assuming the 90 days trading horizon Axway Software SA is expected to under-perform the AMG Advanced. But the stock apears to be less risky and, when comparing its historical volatility, Axway Software SA is 3.16 times less risky than AMG Advanced. The stock trades about -0.16 of its potential returns per unit of risk. The AMG Advanced Metallurgical is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 1,455 in AMG Advanced Metallurgical on September 13, 2024 and sell it today you would earn a total of 24.00 from holding AMG Advanced Metallurgical or generate 1.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Axway Software SA vs. AMG Advanced Metallurgical
Performance |
| Timeline |
| Axway Software SA |
| AMG Advanced Metallu |
Axway Software and AMG Advanced Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Axway Software and AMG Advanced
The main advantage of trading using opposite Axway Software and AMG Advanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Axway Software position performs unexpectedly, AMG Advanced 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 AMG Advanced will offset losses from the drop in AMG Advanced's long position.| Axway Software vs. Molson Coors Beverage | Axway Software vs. Supermarket Income REIT | Axway Software vs. Addtech | Axway Software vs. Roper Technologies |
| AMG Advanced vs. Jacquet Metal Service | AMG Advanced vs. Edita Food Industries | AMG Advanced vs. Roebuck Food Group | AMG Advanced vs. Golden Metal Resources |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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