Correlation Between Amg River and Oklahoma Municipal
Can any of the company-specific risk be diversified away by investing in both Amg River and Oklahoma Municipal 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 Amg River and Oklahoma Municipal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amg River Road and Oklahoma Municipal Fund, you can compare the effects of market volatilities on Amg River and Oklahoma Municipal 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 Amg River with a short position of Oklahoma Municipal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amg River and Oklahoma Municipal.
Diversification Opportunities for Amg River and Oklahoma Municipal
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Amg and Oklahoma is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Amg River Road and Oklahoma Municipal Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oklahoma Municipal and Amg River 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 Amg River Road are associated (or correlated) with Oklahoma Municipal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oklahoma Municipal has no effect on the direction of Amg River i.e., Amg River and Oklahoma Municipal go up and down completely randomly.
Pair Corralation between Amg River and Oklahoma Municipal
Assuming the 90 days horizon Amg River Road is expected to generate 3.76 times more return on investment than Oklahoma Municipal. However, Amg River is 3.76 times more volatile than Oklahoma Municipal Fund. It trades about 0.1 of its potential returns per unit of risk. Oklahoma Municipal Fund is currently generating about 0.12 per unit of risk. If you would invest 1,079 in Amg River Road on September 15, 2024 and sell it today you would earn a total of 15.00 from holding Amg River Road or generate 1.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amg River Road vs. Oklahoma Municipal Fund
Performance |
| Timeline |
| Amg River Road |
| Oklahoma Municipal |
Amg River and Oklahoma Municipal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amg River and Oklahoma Municipal
The main advantage of trading using opposite Amg River and Oklahoma Municipal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amg River position performs unexpectedly, Oklahoma Municipal 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 Oklahoma Municipal will offset losses from the drop in Oklahoma Municipal's long position.| Amg River vs. Victory Trivalent International | Amg River vs. Deutsche Global Real | Amg River vs. Mfs International Growth | Amg River vs. Jpmorgan Large Cap |
| Oklahoma Municipal vs. Ab Small Cap | Oklahoma Municipal vs. Vanguard Small Cap Value | Oklahoma Municipal vs. Fpa Queens Road | Oklahoma Municipal vs. Amg River Road |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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