Correlation Between Applied DB and Ama Marine
Can any of the company-specific risk be diversified away by investing in both Applied DB and Ama Marine 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 Applied DB and Ama Marine into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Applied DB Public and Ama Marine Public, you can compare the effects of market volatilities on Applied DB and Ama Marine 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 Applied DB with a short position of Ama Marine. Check out your portfolio center. Please also check ongoing floating volatility patterns of Applied DB and Ama Marine.
Diversification Opportunities for Applied DB and Ama Marine
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Applied and Ama is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Applied DB Public and Ama Marine Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ama Marine Public and Applied DB 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 Applied DB Public are associated (or correlated) with Ama Marine. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ama Marine Public has no effect on the direction of Applied DB i.e., Applied DB and Ama Marine go up and down completely randomly.
Pair Corralation between Applied DB and Ama Marine
Assuming the 90 days trading horizon Applied DB Public is expected to generate 98.54 times more return on investment than Ama Marine. However, Applied DB is 98.54 times more volatile than Ama Marine Public. It trades about 0.11 of its potential returns per unit of risk. Ama Marine Public is currently generating about -0.04 per unit of risk. If you would invest 73.00 in Applied DB Public on August 31, 2024 and sell it today you would earn a total of 9.00 from holding Applied DB Public or generate 12.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Applied DB Public vs. Ama Marine Public
Performance |
| Timeline |
| Applied DB Public |
| Ama Marine Public |
Applied DB and Ama Marine Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Applied DB and Ama Marine
The main advantage of trading using opposite Applied DB and Ama Marine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Applied DB position performs unexpectedly, Ama Marine 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 Ama Marine will offset losses from the drop in Ama Marine's long position.| Applied DB vs. AIRA Factoring Public | Applied DB vs. Ama Marine Public | Applied DB vs. Asia Biomass Public | Applied DB vs. ASIA Capital Group |
| Ama Marine vs. Arrow Syndicate Public | Ama Marine vs. After You Public | Ama Marine vs. Union Auction Public | Ama Marine vs. Akkhie Prakarn Public |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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