Correlation Between Alamo and Ideanomics
Can any of the company-specific risk be diversified away by investing in both Alamo and Ideanomics 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 Alamo and Ideanomics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alamo Group and Ideanomics, you can compare the effects of market volatilities on Alamo and Ideanomics 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 Alamo with a short position of Ideanomics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alamo and Ideanomics.
Diversification Opportunities for Alamo and Ideanomics
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Alamo and Ideanomics is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Alamo Group and Ideanomics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ideanomics and Alamo 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 Alamo Group are associated (or correlated) with Ideanomics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ideanomics has no effect on the direction of Alamo i.e., Alamo and Ideanomics go up and down completely randomly.
Pair Corralation between Alamo and Ideanomics
Considering the 90-day investment horizon Alamo Group is expected to generate 0.2 times more return on investment than Ideanomics. However, Alamo Group is 4.94 times less risky than Ideanomics. It trades about 0.04 of its potential returns per unit of risk. Ideanomics is currently generating about -0.05 per unit of risk. If you would invest 14,538 in Alamo Group on August 31, 2024 and sell it today you would earn a total of 5,251 from holding Alamo Group or generate 36.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 80.08% |
| Values | Daily Returns |
Alamo Group vs. Ideanomics
Performance |
| Timeline |
| Alamo Group |
| Ideanomics |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Alamo and Ideanomics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alamo and Ideanomics
The main advantage of trading using opposite Alamo and Ideanomics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alamo position performs unexpectedly, Ideanomics 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 Ideanomics will offset losses from the drop in Ideanomics' long position.| Alamo vs. Hyster Yale Materials Handling | Alamo vs. Columbus McKinnon | Alamo vs. AGCO Corporation | Alamo vs. Titan International |
| Ideanomics vs. Deere Company | Ideanomics vs. Caterpillar | Ideanomics vs. Lion Electric Corp | Ideanomics vs. Xos Inc |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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