Correlation Between AMP and Carlton Investments
Can any of the company-specific risk be diversified away by investing in both AMP and Carlton Investments 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 AMP and Carlton Investments into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AMP and Carlton Investments, you can compare the effects of market volatilities on AMP and Carlton Investments 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 AMP with a short position of Carlton Investments. Check out your portfolio center. Please also check ongoing floating volatility patterns of AMP and Carlton Investments.
Diversification Opportunities for AMP and Carlton Investments
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between AMP and Carlton is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding AMP and Carlton Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Carlton Investments and AMP 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 AMP are associated (or correlated) with Carlton Investments. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Carlton Investments has no effect on the direction of AMP i.e., AMP and Carlton Investments go up and down completely randomly.
Pair Corralation between AMP and Carlton Investments
Assuming the 90 days trading horizon AMP is expected to generate 1.31 times more return on investment than Carlton Investments. However, AMP is 1.31 times more volatile than Carlton Investments. It trades about 0.01 of its potential returns per unit of risk. Carlton Investments is currently generating about -0.02 per unit of risk. If you would invest 162.00 in AMP on October 9, 2024 and sell it today you would earn a total of 0.00 from holding AMP or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AMP vs. Carlton Investments
Performance |
| Timeline |
| AMP |
| Carlton Investments |
AMP and Carlton Investments Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AMP and Carlton Investments
The main advantage of trading using opposite AMP and Carlton Investments positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AMP position performs unexpectedly, Carlton Investments 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 Carlton Investments will offset losses from the drop in Carlton Investments' long position.| AMP vs. Advanced Braking Technology | AMP vs. Hudson Investment Group | AMP vs. Hansen Technologies | AMP vs. Mach7 Technologies |
| Carlton Investments vs. Ramsay Health Care | Carlton Investments vs. Clime Investment Management | Carlton Investments vs. Navigator Global Investments | Carlton Investments vs. BTC Health Limited |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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