Correlation Between American Public and CHINA OIL
Can any of the company-specific risk be diversified away by investing in both American Public and CHINA OIL 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 American Public and CHINA OIL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Public Education and CHINA OIL AND, you can compare the effects of market volatilities on American Public and CHINA OIL 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 American Public with a short position of CHINA OIL. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Public and CHINA OIL.
Diversification Opportunities for American Public and CHINA OIL
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between American and CHINA is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding American Public Education and CHINA OIL AND in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CHINA OIL AND and American Public 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 American Public Education are associated (or correlated) with CHINA OIL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CHINA OIL AND has no effect on the direction of American Public i.e., American Public and CHINA OIL go up and down completely randomly.
Pair Corralation between American Public and CHINA OIL
If you would invest 1,620 in American Public Education on September 13, 2024 and sell it today you would earn a total of 360.00 from holding American Public Education or generate 22.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
American Public Education vs. CHINA OIL AND
Performance |
| Timeline |
| American Public Education |
| CHINA OIL AND |
American Public and CHINA OIL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Public and CHINA OIL
The main advantage of trading using opposite American Public and CHINA OIL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Public position performs unexpectedly, CHINA OIL 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 CHINA OIL will offset losses from the drop in CHINA OIL's long position.| American Public vs. PLAYTIKA HOLDING DL 01 | American Public vs. NorAm Drilling AS | American Public vs. Major Drilling Group | American Public vs. CDL INVESTMENT |
| CHINA OIL vs. INVITATION HOMES DL | CHINA OIL vs. Infrastrutture Wireless Italiane | CHINA OIL vs. KB HOME | CHINA OIL vs. MTI WIRELESS EDGE |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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