Correlation Between AM EAGLE and CEVA
Can any of the company-specific risk be diversified away by investing in both AM EAGLE and CEVA 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 CEVA 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 CEVA Inc, you can compare the effects of market volatilities on AM EAGLE and CEVA 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 CEVA. Check out your portfolio center. Please also check ongoing floating volatility patterns of AM EAGLE and CEVA.
Diversification Opportunities for AM EAGLE and CEVA
Very good diversification
The 3 months correlation between AFG and CEVA is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding AM EAGLE OUTFITTERS and CEVA Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CEVA 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 CEVA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CEVA Inc has no effect on the direction of AM EAGLE i.e., AM EAGLE and CEVA go up and down completely randomly.
Pair Corralation between AM EAGLE and CEVA
Assuming the 90 days trading horizon AM EAGLE OUTFITTERS is expected to under-perform the CEVA. But the stock apears to be less risky and, when comparing its historical volatility, AM EAGLE OUTFITTERS is 1.29 times less risky than CEVA. The stock trades about -0.02 of its potential returns per unit of risk. The CEVA Inc is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 1,870 in CEVA Inc on September 14, 2024 and sell it today you would earn a total of 1,190 from holding CEVA Inc or generate 63.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.23% |
| Values | Daily Returns |
AM EAGLE OUTFITTERS vs. CEVA Inc
Performance |
| Timeline |
| AM EAGLE OUTFITTERS |
| CEVA Inc |
AM EAGLE and CEVA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AM EAGLE and CEVA
The main advantage of trading using opposite AM EAGLE and CEVA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AM EAGLE position performs unexpectedly, CEVA 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 CEVA will offset losses from the drop in CEVA's long position.The idea behind AM EAGLE OUTFITTERS and CEVA Inc pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| CEVA vs. ALERION CLEANPOWER | CEVA vs. AM EAGLE OUTFITTERS | CEVA vs. SALESFORCE INC CDR | CEVA vs. RYU Apparel |
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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