Correlation Between Ampco Pittsburgh and Quad Graphics

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Can any of the company-specific risk be diversified away by investing in both Ampco Pittsburgh and Quad Graphics 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 Quad Graphics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ampco Pittsburgh and Quad Graphics, you can compare the effects of market volatilities on Ampco Pittsburgh and Quad Graphics 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 Quad Graphics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ampco Pittsburgh and Quad Graphics.

Diversification Opportunities for Ampco Pittsburgh and Quad Graphics

-0.36
  Correlation Coefficient

Very good diversification

The 3 months correlation between Ampco and Quad is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Ampco Pittsburgh and Quad Graphics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Quad Graphics 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 Quad Graphics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Quad Graphics has no effect on the direction of Ampco Pittsburgh i.e., Ampco Pittsburgh and Quad Graphics go up and down completely randomly.

Pair Corralation between Ampco Pittsburgh and Quad Graphics

Allowing for the 90-day total investment horizon Ampco Pittsburgh is expected to generate 11.42 times less return on investment than Quad Graphics. In addition to that, Ampco Pittsburgh is 1.49 times more volatile than Quad Graphics. It trades about 0.0 of its total potential returns per unit of risk. Quad Graphics is currently generating about 0.07 per unit of volatility. If you would invest  350.00  in Quad Graphics on September 1, 2024 and sell it today you would earn a total of  374.00  from holding Quad Graphics or generate 106.86% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Ampco Pittsburgh  vs.  Quad Graphics

 Performance 
       Timeline  
Ampco Pittsburgh 

Risk-Adjusted Performance

6 of 100

 
Weak
 
Strong
Modest
Compared to the overall equity markets, risk-adjusted returns on investments in Ampco Pittsburgh are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Ampco Pittsburgh reported solid returns over the last few months and may actually be approaching a breakup point.
Quad Graphics 

Risk-Adjusted Performance

17 of 100

 
Weak
 
Strong
Solid
Compared to the overall equity markets, risk-adjusted returns on investments in Quad Graphics are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain basic indicators, Quad Graphics exhibited solid returns over the last few months and may actually be approaching a breakup point.

Ampco Pittsburgh and Quad Graphics Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Ampco Pittsburgh and Quad Graphics

The main advantage of trading using opposite Ampco Pittsburgh and Quad Graphics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ampco Pittsburgh position performs unexpectedly, Quad Graphics 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 Quad Graphics will offset losses from the drop in Quad Graphics' long position.
The idea behind Ampco Pittsburgh and Quad Graphics pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.

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