Correlation Between AMAG Austria and InPlay Oil
Can any of the company-specific risk be diversified away by investing in both AMAG Austria and InPlay Oil 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 AMAG Austria and InPlay Oil into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AMAG Austria Metall and InPlay Oil Corp, you can compare the effects of market volatilities on AMAG Austria and InPlay Oil 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 AMAG Austria with a short position of InPlay Oil. Check out your portfolio center. Please also check ongoing floating volatility patterns of AMAG Austria and InPlay Oil.
Diversification Opportunities for AMAG Austria and InPlay Oil
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between AMAG and InPlay is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding AMAG Austria Metall and InPlay Oil Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on InPlay Oil Corp and AMAG Austria 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 AMAG Austria Metall are associated (or correlated) with InPlay Oil. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of InPlay Oil Corp has no effect on the direction of AMAG Austria i.e., AMAG Austria and InPlay Oil go up and down completely randomly.
Pair Corralation between AMAG Austria and InPlay Oil
Assuming the 90 days trading horizon AMAG Austria Metall is expected to generate 0.56 times more return on investment than InPlay Oil. However, AMAG Austria Metall is 1.79 times less risky than InPlay Oil. It trades about -0.02 of its potential returns per unit of risk. InPlay Oil Corp is currently generating about -0.26 per unit of risk. If you would invest 2,390 in AMAG Austria Metall on November 4, 2024 and sell it today you would lose (10.00) from holding AMAG Austria Metall or give up 0.42% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AMAG Austria Metall vs. InPlay Oil Corp
Performance |
| Timeline |
| AMAG Austria Metall |
| InPlay Oil Corp |
AMAG Austria and InPlay Oil Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AMAG Austria and InPlay Oil
The main advantage of trading using opposite AMAG Austria and InPlay Oil positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AMAG Austria position performs unexpectedly, InPlay Oil 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 InPlay Oil will offset losses from the drop in InPlay Oil's long position.| AMAG Austria vs. Scottish Mortgage Investment | AMAG Austria vs. Commercial Vehicle Group | AMAG Austria vs. CARSALESCOM | AMAG Austria vs. NAKED WINES PLC |
| InPlay Oil vs. ScanSource | InPlay Oil vs. Universal Health Realty | InPlay Oil vs. ARDAGH METAL PACDL 0001 | InPlay Oil vs. CVS Health |
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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