Correlation Between AM EAGLE and GAMESTOP
Can any of the company-specific risk be diversified away by investing in both AM EAGLE and GAMESTOP 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 GAMESTOP 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 GAMESTOP, you can compare the effects of market volatilities on AM EAGLE and GAMESTOP 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 GAMESTOP. Check out your portfolio center. Please also check ongoing floating volatility patterns of AM EAGLE and GAMESTOP.
Diversification Opportunities for AM EAGLE and GAMESTOP
Pay attention - limited upside
The 3 months correlation between AFG and GAMESTOP is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding AM EAGLE OUTFITTERS and GAMESTOP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GAMESTOP 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 GAMESTOP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GAMESTOP has no effect on the direction of AM EAGLE i.e., AM EAGLE and GAMESTOP go up and down completely randomly.
Pair Corralation between AM EAGLE and GAMESTOP
Assuming the 90 days trading horizon AM EAGLE OUTFITTERS is expected to generate 0.71 times more return on investment than GAMESTOP. However, AM EAGLE OUTFITTERS is 1.42 times less risky than GAMESTOP. It trades about -0.03 of its potential returns per unit of risk. GAMESTOP is currently generating about -0.03 per unit of risk. If you would invest 1,588 in AM EAGLE OUTFITTERS on October 21, 2024 and sell it today you would lose (28.00) from holding AM EAGLE OUTFITTERS or give up 1.76% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
AM EAGLE OUTFITTERS vs. GAMESTOP
Performance |
| Timeline |
| AM EAGLE OUTFITTERS |
| GAMESTOP |
AM EAGLE and GAMESTOP Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AM EAGLE and GAMESTOP
The main advantage of trading using opposite AM EAGLE and GAMESTOP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AM EAGLE position performs unexpectedly, GAMESTOP 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 GAMESTOP will offset losses from the drop in GAMESTOP's long position.| AM EAGLE vs. PSI Software AG | AM EAGLE vs. VITEC SOFTWARE GROUP | AM EAGLE vs. ALEFARM BREWING DK 05 | AM EAGLE vs. Unity Software |
| GAMESTOP vs. SOUTHWEST AIRLINES | GAMESTOP vs. JAPAN AIRLINES | GAMESTOP vs. Air Lease | GAMESTOP vs. SINGAPORE AIRLINES |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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