Correlation Between Amg River and Strategic Asset
Can any of the company-specific risk be diversified away by investing in both Amg River and Strategic Asset 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 Strategic Asset 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 Strategic Asset Management, you can compare the effects of market volatilities on Amg River and Strategic Asset 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 Strategic Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amg River and Strategic Asset.
Diversification Opportunities for Amg River and Strategic Asset
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between AMG and Strategic is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Amg River Road and Strategic Asset Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Strategic Asset Mana 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 Strategic Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Strategic Asset Mana has no effect on the direction of Amg River i.e., Amg River and Strategic Asset go up and down completely randomly.
Pair Corralation between Amg River and Strategic Asset
Assuming the 90 days horizon Amg River Road is expected to generate 1.48 times more return on investment than Strategic Asset. However, Amg River is 1.48 times more volatile than Strategic Asset Management. It trades about 0.13 of its potential returns per unit of risk. Strategic Asset Management is currently generating about 0.12 per unit of risk. If you would invest 1,496 in Amg River Road on September 5, 2024 and sell it today you would earn a total of 283.00 from holding Amg River Road or generate 18.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amg River Road vs. Strategic Asset Management
Performance |
| Timeline |
| Amg River Road |
| Strategic Asset Mana |
Amg River and Strategic Asset Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amg River and Strategic Asset
The main advantage of trading using opposite Amg River and Strategic Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amg River position performs unexpectedly, Strategic Asset 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 Strategic Asset will offset losses from the drop in Strategic Asset's long position.| Amg River vs. Alger Smallcap Growth | Amg River vs. Deutsche Global Real | Amg River vs. Amg River Road | Amg River vs. Delaware Value Fund |
| Strategic Asset vs. Artisan Small Cap | Strategic Asset vs. Glg Intl Small | Strategic Asset vs. Small Midcap Dividend Income | Strategic Asset vs. Small Pany Growth |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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