Correlation Between 88 Energy and Amedeo Air
Can any of the company-specific risk be diversified away by investing in both 88 Energy and Amedeo Air 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 88 Energy and Amedeo Air into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between 88 Energy and Amedeo Air Four, you can compare the effects of market volatilities on 88 Energy and Amedeo Air 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 88 Energy with a short position of Amedeo Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of 88 Energy and Amedeo Air.
Diversification Opportunities for 88 Energy and Amedeo Air
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between 88E and Amedeo is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding 88 Energy and Amedeo Air Four in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amedeo Air Four and 88 Energy 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 88 Energy are associated (or correlated) with Amedeo Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amedeo Air Four has no effect on the direction of 88 Energy i.e., 88 Energy and Amedeo Air go up and down completely randomly.
Pair Corralation between 88 Energy and Amedeo Air
Assuming the 90 days trading horizon 88 Energy is expected to under-perform the Amedeo Air. In addition to that, 88 Energy is 1.65 times more volatile than Amedeo Air Four. It trades about -0.07 of its total potential returns per unit of risk. Amedeo Air Four is currently generating about 0.1 per unit of volatility. If you would invest 4,230 in Amedeo Air Four on November 28, 2024 and sell it today you would earn a total of 1,750 from holding Amedeo Air Four or generate 41.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
88 Energy vs. Amedeo Air Four
Performance |
| Timeline |
| 88 Energy |
| Amedeo Air Four |
88 Energy and Amedeo Air Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 88 Energy and Amedeo Air
The main advantage of trading using opposite 88 Energy and Amedeo Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 88 Energy position performs unexpectedly, Amedeo Air 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 Amedeo Air will offset losses from the drop in Amedeo Air's long position.| 88 Energy vs. Associated British Foods | 88 Energy vs. Check Point Software | 88 Energy vs. Premier Foods PLC | 88 Energy vs. Vitec Software Group |
| Amedeo Air vs. Mobile Tornado Group | Amedeo Air vs. Morgan Advanced Materials | Amedeo Air vs. Playtech Plc | Amedeo Air vs. Ubisoft Entertainment |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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