Correlation Between American International and USCorp
Can any of the company-specific risk be diversified away by investing in both American International and USCorp 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 International and USCorp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American International Ventures and USCorp, you can compare the effects of market volatilities on American International and USCorp 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 International with a short position of USCorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of American International and USCorp.
Diversification Opportunities for American International and USCorp
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between American and USCorp is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding American International Venture and USCorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on USCorp and American International 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 International Ventures are associated (or correlated) with USCorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of USCorp has no effect on the direction of American International i.e., American International and USCorp go up and down completely randomly.
Pair Corralation between American International and USCorp
If you would invest 0.02 in USCorp on November 28, 2024 and sell it today you would earn a total of 0.00 from holding USCorp or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
American International Venture vs. USCorp
Performance |
| Timeline |
| American International |
| USCorp |
American International and USCorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American International and USCorp
The main advantage of trading using opposite American International and USCorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American International position performs unexpectedly, USCorp 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 USCorp will offset losses from the drop in USCorp's long position.| American International vs. Labrador Gold Corp | American International vs. Aurion Resources | American International vs. Puma Exploration | American International vs. Golden Star Resource |
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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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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