Correlation Between Ameriprise Financial and Aozora Bank
Can any of the company-specific risk be diversified away by investing in both Ameriprise Financial and Aozora Bank 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 Ameriprise Financial and Aozora Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ameriprise Financial and Aozora Bank, you can compare the effects of market volatilities on Ameriprise Financial and Aozora Bank 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 Ameriprise Financial with a short position of Aozora Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ameriprise Financial and Aozora Bank.
Diversification Opportunities for Ameriprise Financial and Aozora Bank
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Ameriprise and Aozora is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Ameriprise Financial and Aozora Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aozora Bank and Ameriprise Financial 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 Ameriprise Financial are associated (or correlated) with Aozora Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aozora Bank has no effect on the direction of Ameriprise Financial i.e., Ameriprise Financial and Aozora Bank go up and down completely randomly.
Pair Corralation between Ameriprise Financial and Aozora Bank
Assuming the 90 days horizon Ameriprise Financial is expected to generate 0.54 times more return on investment than Aozora Bank. However, Ameriprise Financial is 1.86 times less risky than Aozora Bank. It trades about -0.11 of its potential returns per unit of risk. Aozora Bank is currently generating about -0.16 per unit of risk. If you would invest 52,840 in Ameriprise Financial on September 12, 2024 and sell it today you would lose (1,100) from holding Ameriprise Financial or give up 2.08% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ameriprise Financial vs. Aozora Bank
Performance |
| Timeline |
| Ameriprise Financial |
| Aozora Bank |
Ameriprise Financial and Aozora Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ameriprise Financial and Aozora Bank
The main advantage of trading using opposite Ameriprise Financial and Aozora Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ameriprise Financial position performs unexpectedly, Aozora Bank 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 Aozora Bank will offset losses from the drop in Aozora Bank's long position.| Ameriprise Financial vs. Ares Management Corp | Ameriprise Financial vs. Superior Plus Corp | Ameriprise Financial vs. SIVERS SEMICONDUCTORS AB | Ameriprise Financial vs. CHINA HUARONG ENERHD 50 |
| Aozora Bank vs. Agricultural Bank of | Aozora Bank vs. Commonwealth Bank of | Aozora Bank vs. Superior Plus Corp | Aozora Bank vs. SIVERS SEMICONDUCTORS AB |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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