Correlation Between American Eagle and Polski Koncern
Can any of the company-specific risk be diversified away by investing in both American Eagle and Polski Koncern 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 American Eagle and Polski Koncern into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Eagle Outfitters and Polski Koncern Naftowy, you can compare the effects of market volatilities on American Eagle and Polski Koncern 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 American Eagle with a short position of Polski Koncern. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Eagle and Polski Koncern.
Diversification Opportunities for American Eagle and Polski Koncern
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between American and Polski is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding American Eagle Outfitters and Polski Koncern Naftowy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Polski Koncern Naftowy and American 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 American Eagle Outfitters are associated (or correlated) with Polski Koncern. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Polski Koncern Naftowy has no effect on the direction of American Eagle i.e., American Eagle and Polski Koncern go up and down completely randomly.
Pair Corralation between American Eagle and Polski Koncern
Assuming the 90 days trading horizon American Eagle Outfitters is expected to under-perform the Polski Koncern. But the stock apears to be less risky and, when comparing its historical volatility, American Eagle Outfitters is 1.12 times less risky than Polski Koncern. The stock trades about -0.14 of its potential returns per unit of risk. The Polski Koncern Naftowy is currently generating about -0.04 of returns per unit of risk over similar time horizon. If you would invest 1,230 in Polski Koncern Naftowy on August 25, 2024 and sell it today you would lose (34.00) from holding Polski Koncern Naftowy or give up 2.76% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
American Eagle Outfitters vs. Polski Koncern Naftowy
Performance |
| Timeline |
| American Eagle Outfitters |
| Polski Koncern Naftowy |
American Eagle and Polski Koncern Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Eagle and Polski Koncern
The main advantage of trading using opposite American Eagle and Polski Koncern positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Eagle position performs unexpectedly, Polski Koncern 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 Polski Koncern will offset losses from the drop in Polski Koncern's long position.| American Eagle vs. Apple Inc | American Eagle vs. Apple Inc | American Eagle vs. Apple Inc | American Eagle vs. Apple Inc |
| Polski Koncern vs. MINCO SILVER | Polski Koncern vs. Tsingtao Brewery | Polski Koncern vs. American Eagle Outfitters | Polski Koncern vs. MAGNUM MINING EXP |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
Other Complementary Tools
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios |