Correlation Between Ameriprise Financial and Sixth Street
Can any of the company-specific risk be diversified away by investing in both Ameriprise Financial and Sixth Street 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 Sixth Street into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ameriprise Financial and Sixth Street Specialty, you can compare the effects of market volatilities on Ameriprise Financial and Sixth Street 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 Sixth Street. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ameriprise Financial and Sixth Street.
Diversification Opportunities for Ameriprise Financial and Sixth Street
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ameriprise and Sixth is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Ameriprise Financial and Sixth Street Specialty in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sixth Street Specialty 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 Sixth Street. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sixth Street Specialty has no effect on the direction of Ameriprise Financial i.e., Ameriprise Financial and Sixth Street go up and down completely randomly.
Pair Corralation between Ameriprise Financial and Sixth Street
Considering the 90-day investment horizon Ameriprise Financial is expected to generate 2.63 times more return on investment than Sixth Street. However, Ameriprise Financial is 2.63 times more volatile than Sixth Street Specialty. It trades about 0.22 of its potential returns per unit of risk. Sixth Street Specialty is currently generating about 0.09 per unit of risk. If you would invest 51,190 in Ameriprise Financial on August 27, 2024 and sell it today you would earn a total of 6,017 from holding Ameriprise Financial or generate 11.75% 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. Sixth Street Specialty
Performance |
| Timeline |
| Ameriprise Financial |
| Sixth Street Specialty |
Ameriprise Financial and Sixth Street Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ameriprise Financial and Sixth Street
The main advantage of trading using opposite Ameriprise Financial and Sixth Street positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ameriprise Financial position performs unexpectedly, Sixth Street 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 Sixth Street will offset losses from the drop in Sixth Street's long position.| Ameriprise Financial vs. State Street Corp | Ameriprise Financial vs. Bank of New | Ameriprise Financial vs. SEI Investments | Ameriprise Financial vs. Principal Financial Group |
| Sixth Street vs. New Mountain Finance | Sixth Street vs. Carlyle Secured Lending | Sixth Street vs. BlackRock TCP Capital | Sixth Street vs. Fidus Investment Corp |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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