Correlation Between Amer Sports, and Aterian
Can any of the company-specific risk be diversified away by investing in both Amer Sports, and Aterian 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 Amer Sports, and Aterian into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amer Sports, and Aterian, you can compare the effects of market volatilities on Amer Sports, and Aterian 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 Amer Sports, with a short position of Aterian. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amer Sports, and Aterian.
Diversification Opportunities for Amer Sports, and Aterian
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Amer and Aterian is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Amer Sports, and Aterian in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aterian and Amer Sports, 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 Amer Sports, are associated (or correlated) with Aterian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aterian has no effect on the direction of Amer Sports, i.e., Amer Sports, and Aterian go up and down completely randomly.
Pair Corralation between Amer Sports, and Aterian
Allowing for the 90-day total investment horizon Amer Sports, is expected to generate 1.37 times more return on investment than Aterian. However, Amer Sports, is 1.37 times more volatile than Aterian. It trades about 0.36 of its potential returns per unit of risk. Aterian is currently generating about -0.22 per unit of risk. If you would invest 1,762 in Amer Sports, on August 24, 2024 and sell it today you would earn a total of 607.00 from holding Amer Sports, or generate 34.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amer Sports, vs. Aterian
Performance |
| Timeline |
| Amer Sports, |
| Aterian |
Amer Sports, and Aterian Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amer Sports, and Aterian
The main advantage of trading using opposite Amer Sports, and Aterian positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amer Sports, position performs unexpectedly, Aterian 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 Aterian will offset losses from the drop in Aterian's long position.| Amer Sports, vs. Hf Foods Group | Amer Sports, vs. FitLife Brands, Common | Amer Sports, vs. Siriuspoint | Amer Sports, vs. ICC Holdings |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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