Correlation Between Amundi Index and Neometals
Can any of the company-specific risk be diversified away by investing in both Amundi Index and Neometals 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 Amundi Index and Neometals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amundi Index Solutions and Neometals, you can compare the effects of market volatilities on Amundi Index and Neometals 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 Amundi Index with a short position of Neometals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amundi Index and Neometals.
Diversification Opportunities for Amundi Index and Neometals
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Amundi and Neometals is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Amundi Index Solutions and Neometals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Neometals and Amundi Index 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 Amundi Index Solutions are associated (or correlated) with Neometals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Neometals has no effect on the direction of Amundi Index i.e., Amundi Index and Neometals go up and down completely randomly.
Pair Corralation between Amundi Index and Neometals
Assuming the 90 days trading horizon Amundi Index Solutions is expected to generate 0.23 times more return on investment than Neometals. However, Amundi Index Solutions is 4.35 times less risky than Neometals. It trades about 0.06 of its potential returns per unit of risk. Neometals is currently generating about -0.04 per unit of risk. If you would invest 3,446 in Amundi Index Solutions on August 27, 2024 and sell it today you would earn a total of 561.00 from holding Amundi Index Solutions or generate 16.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amundi Index Solutions vs. Neometals
Performance |
| Timeline |
| Amundi Index Solutions |
| Neometals |
Amundi Index and Neometals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amundi Index and Neometals
The main advantage of trading using opposite Amundi Index and Neometals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amundi Index position performs unexpectedly, Neometals 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 Neometals will offset losses from the drop in Neometals' long position.| Amundi Index vs. Amundi EUR High | Amundi Index vs. Amundi Index Solutions | Amundi Index vs. Amundi MSCI Pacific | Amundi Index vs. Amundi MSCI Europe |
| Neometals vs. Givaudan SA | Neometals vs. Antofagasta PLC | Neometals vs. Centamin PLC | Neometals vs. Atalaya Mining |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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