Correlation Between Alcoa Corp and AMGEN
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By analyzing existing cross correlation between Alcoa Corp and AMGEN INC 515, you can compare the effects of market volatilities on Alcoa Corp and AMGEN 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 Alcoa Corp with a short position of AMGEN. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alcoa Corp and AMGEN.
Diversification Opportunities for Alcoa Corp and AMGEN
-0.79 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Alcoa and AMGEN is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding Alcoa Corp and AMGEN INC 515 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AMGEN INC 515 and Alcoa Corp 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 Alcoa Corp are associated (or correlated) with AMGEN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AMGEN INC 515 has no effect on the direction of Alcoa Corp i.e., Alcoa Corp and AMGEN go up and down completely randomly.
Pair Corralation between Alcoa Corp and AMGEN
Allowing for the 90-day total investment horizon Alcoa Corp is expected to generate 2.55 times more return on investment than AMGEN. However, Alcoa Corp is 2.55 times more volatile than AMGEN INC 515. It trades about 0.11 of its potential returns per unit of risk. AMGEN INC 515 is currently generating about 0.02 per unit of risk. If you would invest 2,669 in Alcoa Corp on September 1, 2024 and sell it today you would earn a total of 1,974 from holding Alcoa Corp or generate 73.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 96.28% |
| Values | Daily Returns |
Alcoa Corp vs. AMGEN INC 515
Performance |
| Timeline |
| Alcoa Corp |
| AMGEN INC 515 |
Alcoa Corp and AMGEN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alcoa Corp and AMGEN
The main advantage of trading using opposite Alcoa Corp and AMGEN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alcoa Corp position performs unexpectedly, AMGEN 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 AMGEN will offset losses from the drop in AMGEN's long position.| Alcoa Corp vs. Fortitude Gold Corp | Alcoa Corp vs. New Gold | Alcoa Corp vs. Galiano Gold | Alcoa Corp vs. GoldMining |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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