Correlation Between American National and Triton International
Can any of the company-specific risk be diversified away by investing in both American National and Triton International 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 American National and Triton International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American National Group and Triton International Limited, you can compare the effects of market volatilities on American National and Triton International 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 American National with a short position of Triton International. Check out your portfolio center. Please also check ongoing floating volatility patterns of American National and Triton International.
Diversification Opportunities for American National and Triton International
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between American and Triton is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding American National Group and Triton International Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Triton International and American National 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 American National Group are associated (or correlated) with Triton International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Triton International has no effect on the direction of American National i.e., American National and Triton International go up and down completely randomly.
Pair Corralation between American National and Triton International
Assuming the 90 days trading horizon American National is expected to generate 1.26 times less return on investment than Triton International. But when comparing it to its historical volatility, American National Group is 1.13 times less risky than Triton International. It trades about 0.23 of its potential returns per unit of risk. Triton International Limited is currently generating about 0.25 of returns per unit of risk over similar time horizon. If you would invest 2,460 in Triton International Limited on September 5, 2024 and sell it today you would earn a total of 69.00 from holding Triton International Limited or generate 2.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
American National Group vs. Triton International Limited
Performance |
| Timeline |
| American National |
| Triton International |
American National and Triton International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American National and Triton International
The main advantage of trading using opposite American National and Triton International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American National position performs unexpectedly, Triton International 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 Triton International will offset losses from the drop in Triton International's long position.| American National vs. Triton International Limited | American National vs. HE Equipment Services | American National vs. WiMi Hologram Cloud | American National vs. Iridium Communications |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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