Correlation Between Amer Sports, and Vista Outdoor
Can any of the company-specific risk be diversified away by investing in both Amer Sports, and Vista Outdoor 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 Vista Outdoor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amer Sports, and Vista Outdoor, you can compare the effects of market volatilities on Amer Sports, and Vista Outdoor 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 Vista Outdoor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amer Sports, and Vista Outdoor.
Diversification Opportunities for Amer Sports, and Vista Outdoor
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Amer and Vista is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Amer Sports, and Vista Outdoor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vista Outdoor 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 Vista Outdoor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vista Outdoor has no effect on the direction of Amer Sports, i.e., Amer Sports, and Vista Outdoor go up and down completely randomly.
Pair Corralation between Amer Sports, and Vista Outdoor
Allowing for the 90-day total investment horizon Amer Sports, is expected to generate 1.36 times more return on investment than Vista Outdoor. However, Amer Sports, is 1.36 times more volatile than Vista Outdoor. It trades about 0.09 of its potential returns per unit of risk. Vista Outdoor is currently generating about 0.05 per unit of risk. If you would invest 1,340 in Amer Sports, on August 23, 2024 and sell it today you would earn a total of 756.00 from holding Amer Sports, or generate 56.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 41.33% |
| Values | Daily Returns |
Amer Sports, vs. Vista Outdoor
Performance |
| Timeline |
| Amer Sports, |
| Vista Outdoor |
Amer Sports, and Vista Outdoor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amer Sports, and Vista Outdoor
The main advantage of trading using opposite Amer Sports, and Vista Outdoor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amer Sports, position performs unexpectedly, Vista Outdoor 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 Vista Outdoor will offset losses from the drop in Vista Outdoor's long position.| Amer Sports, vs. Hf Foods Group | Amer Sports, vs. FitLife Brands, Common | Amer Sports, vs. Siriuspoint | Amer Sports, vs. ICC Holdings |
| Vista Outdoor vs. Clarus Corp | Vista Outdoor vs. Johnson Outdoors | Vista Outdoor vs. Escalade Incorporated | Vista Outdoor vs. JAKKS Pacific |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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