Correlation Between AMEN Properties and PennyMac Mortgage
Can any of the company-specific risk be diversified away by investing in both AMEN Properties and PennyMac Mortgage 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 AMEN Properties and PennyMac Mortgage into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AMEN Properties and PennyMac Mortgage Investment, you can compare the effects of market volatilities on AMEN Properties and PennyMac Mortgage 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 AMEN Properties with a short position of PennyMac Mortgage. Check out your portfolio center. Please also check ongoing floating volatility patterns of AMEN Properties and PennyMac Mortgage.
Diversification Opportunities for AMEN Properties and PennyMac Mortgage
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between AMEN and PennyMac is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding AMEN Properties and PennyMac Mortgage Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PennyMac Mortgage and AMEN Properties 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 AMEN Properties are associated (or correlated) with PennyMac Mortgage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PennyMac Mortgage has no effect on the direction of AMEN Properties i.e., AMEN Properties and PennyMac Mortgage go up and down completely randomly.
Pair Corralation between AMEN Properties and PennyMac Mortgage
If you would invest 52,390 in AMEN Properties on August 27, 2024 and sell it today you would earn a total of 0.00 from holding AMEN Properties or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 4.76% |
| Values | Daily Returns |
AMEN Properties vs. PennyMac Mortgage Investment
Performance |
| Timeline |
| AMEN Properties |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| PennyMac Mortgage |
AMEN Properties and PennyMac Mortgage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AMEN Properties and PennyMac Mortgage
The main advantage of trading using opposite AMEN Properties and PennyMac Mortgage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AMEN Properties position performs unexpectedly, PennyMac Mortgage 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 PennyMac Mortgage will offset losses from the drop in PennyMac Mortgage's long position.| AMEN Properties vs. AER Energy Resources | AMEN Properties vs. Altura Energy | AMEN Properties vs. Alamo Energy Corp | AMEN Properties vs. Arete Industries |
| PennyMac Mortgage vs. Rithm Capital Corp | PennyMac Mortgage vs. Chimera Investment | PennyMac Mortgage vs. Two Harbors Investment | PennyMac Mortgage vs. ARMOUR Residential REIT |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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