Correlation Between Amper SA and Duro Felguera
Can any of the company-specific risk be diversified away by investing in both Amper SA and Duro Felguera 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 Duro Felguera into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amper SA and Duro Felguera, you can compare the effects of market volatilities on Amper SA and Duro Felguera 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 Duro Felguera. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amper SA and Duro Felguera.
Diversification Opportunities for Amper SA and Duro Felguera
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Amper and Duro is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Amper SA and Duro Felguera in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Duro Felguera 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 Duro Felguera. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Duro Felguera has no effect on the direction of Amper SA i.e., Amper SA and Duro Felguera go up and down completely randomly.
Pair Corralation between Amper SA and Duro Felguera
Assuming the 90 days trading horizon Amper SA is expected to under-perform the Duro Felguera. But the stock apears to be less risky and, when comparing its historical volatility, Amper SA is 3.16 times less risky than Duro Felguera. The stock trades about -0.1 of its potential returns per unit of risk. The Duro Felguera is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 37.00 in Duro Felguera on August 31, 2024 and sell it today you would earn a total of 13.00 from holding Duro Felguera or generate 35.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Amper SA vs. Duro Felguera
Performance |
| Timeline |
| Amper SA |
| Duro Felguera |
Amper SA and Duro Felguera Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amper SA and Duro Felguera
The main advantage of trading using opposite Amper SA and Duro Felguera positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amper SA position performs unexpectedly, Duro Felguera 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 Duro Felguera will offset losses from the drop in Duro Felguera's long position.The idea behind Amper SA and Duro Felguera 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.| Duro Felguera vs. Home Capital Rentals | Duro Felguera vs. Aedas Homes SL | Duro Felguera vs. Arteche Lantegi Elkartea | Duro Felguera vs. Borges Agricultural Industrial |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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