Correlation Between Alcoa Corp and EXPRESS
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By analyzing existing cross correlation between Alcoa Corp and EXPRESS SCRIPTS HLDG, you can compare the effects of market volatilities on Alcoa Corp and EXPRESS 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 EXPRESS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alcoa Corp and EXPRESS.
Diversification Opportunities for Alcoa Corp and EXPRESS
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Alcoa and EXPRESS is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Alcoa Corp and EXPRESS SCRIPTS HLDG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EXPRESS SCRIPTS HLDG 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 EXPRESS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EXPRESS SCRIPTS HLDG has no effect on the direction of Alcoa Corp i.e., Alcoa Corp and EXPRESS go up and down completely randomly.
Pair Corralation between Alcoa Corp and EXPRESS
Allowing for the 90-day total investment horizon Alcoa Corp is expected to generate 2.76 times more return on investment than EXPRESS. However, Alcoa Corp is 2.76 times more volatile than EXPRESS SCRIPTS HLDG. It trades about 0.22 of its potential returns per unit of risk. EXPRESS SCRIPTS HLDG is currently generating about -0.21 per unit of risk. If you would invest 4,131 in Alcoa Corp on August 28, 2024 and sell it today you would earn a total of 591.00 from holding Alcoa Corp or generate 14.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 85.71% |
| Values | Daily Returns |
Alcoa Corp vs. EXPRESS SCRIPTS HLDG
Performance |
| Timeline |
| Alcoa Corp |
| EXPRESS SCRIPTS HLDG |
Alcoa Corp and EXPRESS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alcoa Corp and EXPRESS
The main advantage of trading using opposite Alcoa Corp and EXPRESS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alcoa Corp position performs unexpectedly, EXPRESS 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 EXPRESS will offset losses from the drop in EXPRESS's long position.The idea behind Alcoa Corp and EXPRESS SCRIPTS HLDG pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| EXPRESS vs. The Coca Cola | EXPRESS vs. JPMorgan Chase Co | EXPRESS vs. Dupont De Nemours | EXPRESS vs. Alcoa Corp |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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