Correlation Between American Express and Amrica Mvil
Can any of the company-specific risk be diversified away by investing in both American Express and Amrica Mvil 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 Amrica Mvil into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Express and Amrica Mvil SAB, you can compare the effects of market volatilities on American Express and Amrica Mvil 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 Amrica Mvil. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Express and Amrica Mvil.
Diversification Opportunities for American Express and Amrica Mvil
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between American and Amrica is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding American Express and Amrica Mvil SAB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amrica Mvil SAB 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 Amrica Mvil. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amrica Mvil SAB has no effect on the direction of American Express i.e., American Express and Amrica Mvil go up and down completely randomly.
Pair Corralation between American Express and Amrica Mvil
If you would invest 16,191 in American Express on September 14, 2024 and sell it today you would earn a total of 14,027 from holding American Express or generate 86.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 0.37% |
| Values | Daily Returns |
American Express vs. Amrica Mvil SAB
Performance |
| Timeline |
| American Express |
| Amrica Mvil SAB |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
American Express and Amrica Mvil Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Express and Amrica Mvil
The main advantage of trading using opposite American Express and Amrica Mvil positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Express position performs unexpectedly, Amrica Mvil 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 Amrica Mvil will offset losses from the drop in Amrica Mvil's long position.| American Express vs. Visa Class A | American Express vs. PayPal Holdings | American Express vs. Upstart Holdings | American Express vs. Mastercard |
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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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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