Correlation Between Ameriprise Financial and SERI INDUSTRIAL
Can any of the company-specific risk be diversified away by investing in both Ameriprise Financial and SERI INDUSTRIAL 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 SERI INDUSTRIAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ameriprise Financial and SERI INDUSTRIAL EO, you can compare the effects of market volatilities on Ameriprise Financial and SERI INDUSTRIAL 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 SERI INDUSTRIAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ameriprise Financial and SERI INDUSTRIAL.
Diversification Opportunities for Ameriprise Financial and SERI INDUSTRIAL
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Ameriprise and SERI is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Ameriprise Financial and SERI INDUSTRIAL EO in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SERI INDUSTRIAL EO 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 SERI INDUSTRIAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SERI INDUSTRIAL EO has no effect on the direction of Ameriprise Financial i.e., Ameriprise Financial and SERI INDUSTRIAL go up and down completely randomly.
Pair Corralation between Ameriprise Financial and SERI INDUSTRIAL
Assuming the 90 days horizon Ameriprise Financial is expected to generate 0.34 times more return on investment than SERI INDUSTRIAL. However, Ameriprise Financial is 2.92 times less risky than SERI INDUSTRIAL. It trades about 0.11 of its potential returns per unit of risk. SERI INDUSTRIAL EO is currently generating about -0.02 per unit of risk. If you would invest 31,164 in Ameriprise Financial on September 12, 2024 and sell it today you would earn a total of 20,576 from holding Ameriprise Financial or generate 66.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ameriprise Financial vs. SERI INDUSTRIAL EO
Performance |
| Timeline |
| Ameriprise Financial |
| SERI INDUSTRIAL EO |
Ameriprise Financial and SERI INDUSTRIAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ameriprise Financial and SERI INDUSTRIAL
The main advantage of trading using opposite Ameriprise Financial and SERI INDUSTRIAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ameriprise Financial position performs unexpectedly, SERI INDUSTRIAL 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 SERI INDUSTRIAL will offset losses from the drop in SERI INDUSTRIAL'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 |
| SERI INDUSTRIAL vs. Ameriprise Financial | SERI INDUSTRIAL vs. Gamma Communications plc | SERI INDUSTRIAL vs. IMPERIAL TOBACCO | SERI INDUSTRIAL vs. Cogent Communications Holdings |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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