Correlation Between AmTrust Financial and ECOLAB
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By analyzing existing cross correlation between AmTrust Financial Services and ECOLAB INC 325, you can compare the effects of market volatilities on AmTrust Financial and ECOLAB 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 AmTrust Financial with a short position of ECOLAB. Check out your portfolio center. Please also check ongoing floating volatility patterns of AmTrust Financial and ECOLAB.
Diversification Opportunities for AmTrust Financial and ECOLAB
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between AmTrust and ECOLAB is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding AmTrust Financial Services and ECOLAB INC 325 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ECOLAB INC 325 and AmTrust Financial 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 AmTrust Financial Services are associated (or correlated) with ECOLAB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ECOLAB INC 325 has no effect on the direction of AmTrust Financial i.e., AmTrust Financial and ECOLAB go up and down completely randomly.
Pair Corralation between AmTrust Financial and ECOLAB
Assuming the 90 days horizon AmTrust Financial Services is expected to generate 6.19 times more return on investment than ECOLAB. However, AmTrust Financial is 6.19 times more volatile than ECOLAB INC 325. It trades about 0.05 of its potential returns per unit of risk. ECOLAB INC 325 is currently generating about -0.11 per unit of risk. If you would invest 1,400 in AmTrust Financial Services on September 3, 2024 and sell it today you would earn a total of 60.00 from holding AmTrust Financial Services or generate 4.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 92.19% |
| Values | Daily Returns |
AmTrust Financial Services vs. ECOLAB INC 325
Performance |
| Timeline |
| AmTrust Financial |
| ECOLAB INC 325 |
AmTrust Financial and ECOLAB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AmTrust Financial and ECOLAB
The main advantage of trading using opposite AmTrust Financial and ECOLAB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AmTrust Financial position performs unexpectedly, ECOLAB 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 ECOLAB will offset losses from the drop in ECOLAB's long position.| AmTrust Financial vs. AmTrust Financial Services | AmTrust Financial vs. AmTrust Financial Services | AmTrust Financial vs. AmTrust Financial Services | AmTrust Financial vs. AmTrust Financial Services |
| ECOLAB vs. Glacier Bancorp | ECOLAB vs. AmTrust Financial Services | ECOLAB vs. Fomento Economico Mexicano | ECOLAB vs. Suntory Beverage Food |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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