Correlation Between Amedeo Air and Big Yellow
Can any of the company-specific risk be diversified away by investing in both Amedeo Air and Big Yellow 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 Amedeo Air and Big Yellow into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amedeo Air Four and Big Yellow Group, you can compare the effects of market volatilities on Amedeo Air and Big Yellow 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 Amedeo Air with a short position of Big Yellow. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amedeo Air and Big Yellow.
Diversification Opportunities for Amedeo Air and Big Yellow
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Amedeo and Big is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Amedeo Air Four and Big Yellow Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Big Yellow Group and Amedeo Air 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 Amedeo Air Four are associated (or correlated) with Big Yellow. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Big Yellow Group has no effect on the direction of Amedeo Air i.e., Amedeo Air and Big Yellow go up and down completely randomly.
Pair Corralation between Amedeo Air and Big Yellow
Assuming the 90 days trading horizon Amedeo Air Four is expected to generate 1.21 times more return on investment than Big Yellow. However, Amedeo Air is 1.21 times more volatile than Big Yellow Group. It trades about 0.11 of its potential returns per unit of risk. Big Yellow Group is currently generating about -0.02 per unit of risk. If you would invest 4,045 in Amedeo Air Four on November 3, 2024 and sell it today you would earn a total of 2,225 from holding Amedeo Air Four or generate 55.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amedeo Air Four vs. Big Yellow Group
Performance |
| Timeline |
| Amedeo Air Four |
| Big Yellow Group |
Amedeo Air and Big Yellow Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amedeo Air and Big Yellow
The main advantage of trading using opposite Amedeo Air and Big Yellow positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amedeo Air position performs unexpectedly, Big Yellow 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 Big Yellow will offset losses from the drop in Big Yellow's long position.| Amedeo Air vs. Jacquet Metal Service | Amedeo Air vs. Atalaya Mining | Amedeo Air vs. Morgan Advanced Materials | Amedeo Air vs. GoldMining |
| Big Yellow vs. Derwent London PLC | Big Yellow vs. Hammerson PLC | Big Yellow vs. Workspace Group PLC | Big Yellow vs. Supermarket Income REIT |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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