Correlation Between AMS Small and SPDR BB
Can any of the company-specific risk be diversified away by investing in both AMS Small and SPDR BB 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 AMS Small and SPDR BB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AMS Small Cap and SPDR BB SB, you can compare the effects of market volatilities on AMS Small and SPDR BB 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 AMS Small with a short position of SPDR BB. Check out your portfolio center. Please also check ongoing floating volatility patterns of AMS Small and SPDR BB.
Diversification Opportunities for AMS Small and SPDR BB
Good diversification
The 3 months correlation between AMS and SPDR is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding AMS Small Cap and SPDR BB SB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPDR BB SB and AMS Small 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 AMS Small Cap are associated (or correlated) with SPDR BB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPDR BB SB has no effect on the direction of AMS Small i.e., AMS Small and SPDR BB go up and down completely randomly.
Pair Corralation between AMS Small and SPDR BB
Assuming the 90 days trading horizon AMS Small Cap is expected to under-perform the SPDR BB. In addition to that, AMS Small is 2.71 times more volatile than SPDR BB SB. It trades about -0.21 of its total potential returns per unit of risk. SPDR BB SB is currently generating about -0.06 per unit of volatility. If you would invest 2,627 in SPDR BB SB on August 27, 2024 and sell it today you would lose (13.00) from holding SPDR BB SB or give up 0.49% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AMS Small Cap vs. SPDR BB SB
Performance |
| Timeline |
AMS Small and SPDR BB Volatility Contrast
Predicted Return Density |
| Returns |
AMS Small Cap
Pair trading matchups for AMS Small
SPDR BB SB
Pair trading matchups for SPDR BB
Pair Trading with AMS Small and SPDR BB
The main advantage of trading using opposite AMS Small and SPDR BB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AMS Small position performs unexpectedly, SPDR BB 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 SPDR BB will offset losses from the drop in SPDR BB's long position.| AMS Small vs. AMG Advanced Metallurgical | AMS Small vs. Reinet Investments SCA | AMS Small vs. Accsys Technologies | AMS Small vs. Flow Traders BV |
| SPDR BB vs. SPDR MSCI World | SPDR BB vs. SPDR SP Dividend | SPDR BB vs. SPDR SP 500 | SPDR BB vs. SPDR MSCI World |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
Other Complementary Tools
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules |