Correlation Between Ams AG and BrainChip Holdings
Can any of the company-specific risk be diversified away by investing in both Ams AG and BrainChip Holdings 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 Ams AG and BrainChip Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ams AG and BrainChip Holdings, you can compare the effects of market volatilities on Ams AG and BrainChip Holdings 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 Ams AG with a short position of BrainChip Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ams AG and BrainChip Holdings.
Diversification Opportunities for Ams AG and BrainChip Holdings
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between Ams and BrainChip is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding ams AG and BrainChip Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BrainChip Holdings and Ams AG 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 ams AG are associated (or correlated) with BrainChip Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BrainChip Holdings has no effect on the direction of Ams AG i.e., Ams AG and BrainChip Holdings go up and down completely randomly.
Pair Corralation between Ams AG and BrainChip Holdings
Assuming the 90 days horizon ams AG is expected to under-perform the BrainChip Holdings. In addition to that, Ams AG is 1.76 times more volatile than BrainChip Holdings. It trades about -0.22 of its total potential returns per unit of risk. BrainChip Holdings is currently generating about -0.02 per unit of volatility. If you would invest 17.00 in BrainChip Holdings on August 29, 2024 and sell it today you would lose (1.00) from holding BrainChip Holdings or give up 5.88% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ams AG vs. BrainChip Holdings
Performance |
| Timeline |
| ams AG |
| BrainChip Holdings |
Ams AG and BrainChip Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ams AG and BrainChip Holdings
The main advantage of trading using opposite Ams AG and BrainChip Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ams AG position performs unexpectedly, BrainChip Holdings 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 BrainChip Holdings will offset losses from the drop in BrainChip Holdings' long position.| Ams AG vs. NVIDIA | Ams AG vs. Intel | Ams AG vs. Taiwan Semiconductor Manufacturing | Ams AG vs. Marvell Technology Group |
| BrainChip Holdings vs. NVIDIA | BrainChip Holdings vs. Intel | BrainChip Holdings vs. Taiwan Semiconductor Manufacturing | BrainChip Holdings vs. Marvell Technology Group |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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