Correlation Between American Express and AEZS Old
Can any of the company-specific risk be diversified away by investing in both American Express and AEZS Old 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 American Express and AEZS Old into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Express and AEZS Old, you can compare the effects of market volatilities on American Express and AEZS Old 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 American Express with a short position of AEZS Old. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Express and AEZS Old.
Diversification Opportunities for American Express and AEZS Old
-0.82 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between American and AEZS is -0.82. Overlapping area represents the amount of risk that can be diversified away by holding American Express and AEZS Old in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AEZS Old and American Express 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 American Express are associated (or correlated) with AEZS Old. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AEZS Old has no effect on the direction of American Express i.e., American Express and AEZS Old go up and down completely randomly.
Pair Corralation between American Express and AEZS Old
Considering the 90-day investment horizon American Express is expected to generate 4.45 times less return on investment than AEZS Old. But when comparing it to its historical volatility, American Express is 2.49 times less risky than AEZS Old. It trades about 0.13 of its potential returns per unit of risk. AEZS Old is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest 540.00 in AEZS Old on October 22, 2024 and sell it today you would earn a total of 74.00 from holding AEZS Old or generate 13.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 11.2% |
| Values | Daily Returns |
American Express vs. AEZS Old
Performance |
| Timeline |
| American Express |
| AEZS Old |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
American Express and AEZS Old Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Express and AEZS Old
The main advantage of trading using opposite American Express and AEZS Old positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Express position performs unexpectedly, AEZS Old 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 AEZS Old will offset losses from the drop in AEZS Old's long position.| American Express vs. Roche Holding AG | American Express vs. Champions Oncology | American Express vs. Target 2030 Fund | American Express vs. The Monarch Cement |
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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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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