Correlation Between AM EAGLE and TOWNSQUARE MEDIA
Can any of the company-specific risk be diversified away by investing in both AM EAGLE and TOWNSQUARE MEDIA 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 AM EAGLE and TOWNSQUARE MEDIA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AM EAGLE OUTFITTERS and TOWNSQUARE MEDIA INC, you can compare the effects of market volatilities on AM EAGLE and TOWNSQUARE MEDIA 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 AM EAGLE with a short position of TOWNSQUARE MEDIA. Check out your portfolio center. Please also check ongoing floating volatility patterns of AM EAGLE and TOWNSQUARE MEDIA.
Diversification Opportunities for AM EAGLE and TOWNSQUARE MEDIA
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between AFG and TOWNSQUARE is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding AM EAGLE OUTFITTERS and TOWNSQUARE MEDIA INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TOWNSQUARE MEDIA INC and AM EAGLE 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 AM EAGLE OUTFITTERS are associated (or correlated) with TOWNSQUARE MEDIA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TOWNSQUARE MEDIA INC has no effect on the direction of AM EAGLE i.e., AM EAGLE and TOWNSQUARE MEDIA go up and down completely randomly.
Pair Corralation between AM EAGLE and TOWNSQUARE MEDIA
Assuming the 90 days trading horizon AM EAGLE OUTFITTERS is expected to generate 1.17 times more return on investment than TOWNSQUARE MEDIA. However, AM EAGLE is 1.17 times more volatile than TOWNSQUARE MEDIA INC. It trades about 0.04 of its potential returns per unit of risk. TOWNSQUARE MEDIA INC is currently generating about 0.01 per unit of risk. If you would invest 1,798 in AM EAGLE OUTFITTERS on September 5, 2024 and sell it today you would earn a total of 92.00 from holding AM EAGLE OUTFITTERS or generate 5.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
AM EAGLE OUTFITTERS vs. TOWNSQUARE MEDIA INC
Performance |
| Timeline |
| AM EAGLE OUTFITTERS |
| TOWNSQUARE MEDIA INC |
AM EAGLE and TOWNSQUARE MEDIA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AM EAGLE and TOWNSQUARE MEDIA
The main advantage of trading using opposite AM EAGLE and TOWNSQUARE MEDIA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AM EAGLE position performs unexpectedly, TOWNSQUARE MEDIA 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 TOWNSQUARE MEDIA will offset losses from the drop in TOWNSQUARE MEDIA's long position.| AM EAGLE vs. Compagnie Plastic Omnium | AM EAGLE vs. ANGLER GAMING PLC | AM EAGLE vs. THRACE PLASTICS | AM EAGLE vs. GAMESTOP |
| TOWNSQUARE MEDIA vs. TOTAL GABON | TOWNSQUARE MEDIA vs. Walgreens Boots Alliance | TOWNSQUARE MEDIA vs. Peak Resources Limited |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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