Correlation Between Ameriprise Financial and SPDR Index
Can any of the company-specific risk be diversified away by investing in both Ameriprise Financial and SPDR Index 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 Ameriprise Financial and SPDR Index into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ameriprise Financial and SPDR Index Shares, you can compare the effects of market volatilities on Ameriprise Financial and SPDR Index 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 Ameriprise Financial with a short position of SPDR Index. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ameriprise Financial and SPDR Index.
Diversification Opportunities for Ameriprise Financial and SPDR Index
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ameriprise and SPDR is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Ameriprise Financial and SPDR Index Shares in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPDR Index Shares and Ameriprise Financial 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 Ameriprise Financial are associated (or correlated) with SPDR Index. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPDR Index Shares has no effect on the direction of Ameriprise Financial i.e., Ameriprise Financial and SPDR Index go up and down completely randomly.
Pair Corralation between Ameriprise Financial and SPDR Index
Assuming the 90 days trading horizon Ameriprise Financial is expected to generate 1.24 times more return on investment than SPDR Index. However, Ameriprise Financial is 1.24 times more volatile than SPDR Index Shares. It trades about 0.14 of its potential returns per unit of risk. SPDR Index Shares is currently generating about 0.04 per unit of risk. If you would invest 731,943 in Ameriprise Financial on September 1, 2024 and sell it today you would earn a total of 426,210 from holding Ameriprise Financial or generate 58.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ameriprise Financial vs. SPDR Index Shares
Performance |
| Timeline |
| Ameriprise Financial |
| SPDR Index Shares |
Ameriprise Financial and SPDR Index Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ameriprise Financial and SPDR Index
The main advantage of trading using opposite Ameriprise Financial and SPDR Index positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ameriprise Financial position performs unexpectedly, SPDR Index 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 SPDR Index will offset losses from the drop in SPDR Index's long position.| Ameriprise Financial vs. Banco del Bajo | Ameriprise Financial vs. Gentera SAB de | Ameriprise Financial vs. Megacable Holdings S | Ameriprise Financial vs. Becle SAB de |
| SPDR Index vs. SPDR Dow Jones | SPDR Index vs. SPDR Gold Trust | SPDR Index vs. SPDR SP 500 | SPDR Index vs. SPDR Series Trust |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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