Correlation Between Ams AG and Symphony Environmental
Can any of the company-specific risk be diversified away by investing in both Ams AG and Symphony Environmental 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 Ams AG and Symphony Environmental into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ams AG and Symphony Environmental Technologies, you can compare the effects of market volatilities on Ams AG and Symphony Environmental 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 Ams AG with a short position of Symphony Environmental. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ams AG and Symphony Environmental.
Diversification Opportunities for Ams AG and Symphony Environmental
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Ams and Symphony is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Ams AG and Symphony Environmental Technol in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Symphony Environmental and Ams AG 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 Ams AG are associated (or correlated) with Symphony Environmental. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Symphony Environmental has no effect on the direction of Ams AG i.e., Ams AG and Symphony Environmental go up and down completely randomly.
Pair Corralation between Ams AG and Symphony Environmental
Assuming the 90 days trading horizon Ams AG is expected to generate 8.56 times more return on investment than Symphony Environmental. However, Ams AG is 8.56 times more volatile than Symphony Environmental Technologies. It trades about 0.03 of its potential returns per unit of risk. Symphony Environmental Technologies is currently generating about -0.03 per unit of risk. If you would invest 4,866 in Ams AG on October 9, 2024 and sell it today you would lose (4,249) from holding Ams AG or give up 87.32% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 97.99% |
| Values | Daily Returns |
Ams AG vs. Symphony Environmental Technol
Performance |
| Timeline |
| Ams AG |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Symphony Environmental |
Ams AG and Symphony Environmental Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ams AG and Symphony Environmental
The main advantage of trading using opposite Ams AG and Symphony Environmental positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ams AG position performs unexpectedly, Symphony Environmental 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 Symphony Environmental will offset losses from the drop in Symphony Environmental's long position.| Ams AG vs. PPHE Hotel Group | Ams AG vs. BW Offshore | Ams AG vs. bet at home AG | Ams AG vs. Qurate Retail Series |
| Symphony Environmental vs. Givaudan SA | Symphony Environmental vs. Antofagasta PLC | Symphony Environmental vs. Ferrexpo PLC | Symphony Environmental vs. Atalaya Mining |
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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