Correlation Between Ameriprise Financial and Compagnie
Can any of the company-specific risk be diversified away by investing in both Ameriprise Financial and Compagnie 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 Compagnie into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ameriprise Financial and Compagnie de Saint Gobain, you can compare the effects of market volatilities on Ameriprise Financial and Compagnie 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 Compagnie. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ameriprise Financial and Compagnie.
Diversification Opportunities for Ameriprise Financial and Compagnie
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Ameriprise and Compagnie is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Ameriprise Financial and Compagnie de Saint Gobain in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Compagnie de Saint 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 Compagnie. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Compagnie de Saint has no effect on the direction of Ameriprise Financial i.e., Ameriprise Financial and Compagnie go up and down completely randomly.
Pair Corralation between Ameriprise Financial and Compagnie
Assuming the 90 days horizon Ameriprise Financial is expected to generate 0.9 times more return on investment than Compagnie. However, Ameriprise Financial is 1.11 times less risky than Compagnie. It trades about -0.18 of its potential returns per unit of risk. Compagnie de Saint Gobain is currently generating about -0.2 per unit of risk. If you would invest 52,180 in Ameriprise Financial on October 15, 2024 and sell it today you would lose (1,940) from holding Ameriprise Financial or give up 3.72% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ameriprise Financial vs. Compagnie de Saint Gobain
Performance |
| Timeline |
| Ameriprise Financial |
| Compagnie de Saint |
Ameriprise Financial and Compagnie Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ameriprise Financial and Compagnie
The main advantage of trading using opposite Ameriprise Financial and Compagnie positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ameriprise Financial position performs unexpectedly, Compagnie 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 Compagnie will offset losses from the drop in Compagnie's long position.| Ameriprise Financial vs. KINGBOARD CHEMICAL | Ameriprise Financial vs. Tianjin Capital Environmental | Ameriprise Financial vs. COSMOSTEEL HLDGS | Ameriprise Financial vs. KOBE STEEL LTD |
| Compagnie vs. Cleanaway Waste Management | Compagnie vs. INSURANCE AUST GRP | Compagnie vs. Q2M Managementberatung AG | Compagnie vs. Reinsurance Group of |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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