Correlation Between Ampco Pittsburgh and Boeing
Can any of the company-specific risk be diversified away by investing in both Ampco Pittsburgh and Boeing 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 Ampco Pittsburgh and Boeing into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ampco Pittsburgh and The Boeing, you can compare the effects of market volatilities on Ampco Pittsburgh and Boeing 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 Ampco Pittsburgh with a short position of Boeing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ampco Pittsburgh and Boeing.
Diversification Opportunities for Ampco Pittsburgh and Boeing
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Ampco and Boeing is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Ampco Pittsburgh and The Boeing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Boeing and Ampco Pittsburgh 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 Ampco Pittsburgh are associated (or correlated) with Boeing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Boeing has no effect on the direction of Ampco Pittsburgh i.e., Ampco Pittsburgh and Boeing go up and down completely randomly.
Pair Corralation between Ampco Pittsburgh and Boeing
Allowing for the 90-day total investment horizon Ampco Pittsburgh is expected to generate 2.05 times more return on investment than Boeing. However, Ampco Pittsburgh is 2.05 times more volatile than The Boeing. It trades about 0.15 of its potential returns per unit of risk. The Boeing is currently generating about -0.01 per unit of risk. If you would invest 177.00 in Ampco Pittsburgh on August 31, 2024 and sell it today you would earn a total of 25.00 from holding Ampco Pittsburgh or generate 14.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ampco Pittsburgh vs. The Boeing
Performance |
| Timeline |
| Ampco Pittsburgh |
| Boeing |
Ampco Pittsburgh and Boeing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ampco Pittsburgh and Boeing
The main advantage of trading using opposite Ampco Pittsburgh and Boeing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ampco Pittsburgh position performs unexpectedly, Boeing 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 Boeing will offset losses from the drop in Boeing's long position.| Ampco Pittsburgh vs. Northwest Pipe | Ampco Pittsburgh vs. Insteel Industries | Ampco Pittsburgh vs. Carpenter Technology | Ampco Pittsburgh vs. ESAB Corp |
| Boeing vs. Raytheon Technologies Corp | Boeing vs. Northrop Grumman | Boeing vs. General Dynamics | Boeing vs. L3Harris Technologies |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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