Correlation Between Amg River and Capital Securities
Can any of the company-specific risk be diversified away by investing in both Amg River and Capital Securities 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 Capital Securities 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 Capital Securities Fund, you can compare the effects of market volatilities on Amg River and Capital Securities 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 Capital Securities. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amg River and Capital Securities.
Diversification Opportunities for Amg River and Capital Securities
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Amg and Capital is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Amg River Road and Capital Securities Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Capital Securities 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 Capital Securities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Capital Securities has no effect on the direction of Amg River i.e., Amg River and Capital Securities go up and down completely randomly.
Pair Corralation between Amg River and Capital Securities
Assuming the 90 days horizon Amg River Road is expected to generate 8.55 times more return on investment than Capital Securities. However, Amg River is 8.55 times more volatile than Capital Securities Fund. It trades about 0.37 of its potential returns per unit of risk. Capital Securities Fund is currently generating about -0.03 per unit of risk. If you would invest 1,017 in Amg River Road on August 31, 2024 and sell it today you would earn a total of 104.00 from holding Amg River Road or generate 10.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amg River Road vs. Capital Securities Fund
Performance |
| Timeline |
| Amg River Road |
| Capital Securities |
Amg River and Capital Securities Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amg River and Capital Securities
The main advantage of trading using opposite Amg River and Capital Securities positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amg River position performs unexpectedly, Capital Securities 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 Capital Securities will offset losses from the drop in Capital Securities' long position.| Amg River vs. Amg River Road | Amg River vs. Champlain Small Pany | Amg River vs. Amg River Road | Amg River vs. Marsico Global Fund |
| Capital Securities vs. Amg River Road | Capital Securities vs. Victory Rs Partners | Capital Securities vs. Pace Smallmedium Value | Capital Securities vs. Fpa Queens 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 CEOs Directory module to screen CEOs from public companies around the world.
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