Correlation Between World Energy and Amg Frontier
Can any of the company-specific risk be diversified away by investing in both World Energy and Amg Frontier 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 World Energy and Amg Frontier into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between World Energy Fund and Amg Frontier Small, you can compare the effects of market volatilities on World Energy and Amg Frontier 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 World Energy with a short position of Amg Frontier. Check out your portfolio center. Please also check ongoing floating volatility patterns of World Energy and Amg Frontier.
Diversification Opportunities for World Energy and Amg Frontier
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between World and Amg is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding World Energy Fund and Amg Frontier Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amg Frontier Small and World Energy 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 World Energy Fund are associated (or correlated) with Amg Frontier. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amg Frontier Small has no effect on the direction of World Energy i.e., World Energy and Amg Frontier go up and down completely randomly.
Pair Corralation between World Energy and Amg Frontier
Assuming the 90 days horizon World Energy Fund is expected to under-perform the Amg Frontier. But the mutual fund apears to be less risky and, when comparing its historical volatility, World Energy Fund is 1.23 times less risky than Amg Frontier. The mutual fund trades about -0.11 of its potential returns per unit of risk. The Amg Frontier Small is currently generating about -0.09 of returns per unit of risk over similar time horizon. If you would invest 1,051 in Amg Frontier Small on September 12, 2024 and sell it today you would lose (27.00) from holding Amg Frontier Small or give up 2.57% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
World Energy Fund vs. Amg Frontier Small
Performance |
| Timeline |
| World Energy |
| Amg Frontier Small |
World Energy and Amg Frontier Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with World Energy and Amg Frontier
The main advantage of trading using opposite World Energy and Amg Frontier positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if World Energy position performs unexpectedly, Amg Frontier 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 Amg Frontier will offset losses from the drop in Amg Frontier's long position.| World Energy vs. Aam Select Income | World Energy vs. Arrow Managed Futures | World Energy vs. Rbc Microcap Value | World Energy vs. Volumetric Fund Volumetric |
| Amg Frontier vs. Needham Aggressive Growth | Amg Frontier vs. Ultramid Cap Profund Ultramid Cap | Amg Frontier vs. HUMANA INC | Amg Frontier vs. Barloworld Ltd ADR |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
Other Complementary Tools
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals |