Correlation Between Amper SA and Global Dominion
Can any of the company-specific risk be diversified away by investing in both Amper SA and Global Dominion 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 Amper SA and Global Dominion into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amper SA and Global Dominion Access, you can compare the effects of market volatilities on Amper SA and Global Dominion 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 Amper SA with a short position of Global Dominion. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amper SA and Global Dominion.
Diversification Opportunities for Amper SA and Global Dominion
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Amper and Global is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Amper SA and Global Dominion Access in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Dominion Access and Amper SA 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 Amper SA are associated (or correlated) with Global Dominion. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Dominion Access has no effect on the direction of Amper SA i.e., Amper SA and Global Dominion go up and down completely randomly.
Pair Corralation between Amper SA and Global Dominion
Assuming the 90 days trading horizon Amper SA is expected to generate 2.44 times more return on investment than Global Dominion. However, Amper SA is 2.44 times more volatile than Global Dominion Access. It trades about 0.04 of its potential returns per unit of risk. Global Dominion Access is currently generating about -0.05 per unit of risk. If you would invest 9.27 in Amper SA on August 27, 2024 and sell it today you would earn a total of 1.73 from holding Amper SA or generate 18.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amper SA vs. Global Dominion Access
Performance |
| Timeline |
| Amper SA |
| Global Dominion Access |
Amper SA and Global Dominion Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amper SA and Global Dominion
The main advantage of trading using opposite Amper SA and Global Dominion positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amper SA position performs unexpectedly, Global Dominion 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 Global Dominion will offset losses from the drop in Global Dominion's long position.The idea behind Amper SA and Global Dominion Access pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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