Correlation Between American Express and AnalytixInsight
Can any of the company-specific risk be diversified away by investing in both American Express and AnalytixInsight 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 AnalytixInsight into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Express and AnalytixInsight, you can compare the effects of market volatilities on American Express and AnalytixInsight 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 AnalytixInsight. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Express and AnalytixInsight.
Diversification Opportunities for American Express and AnalytixInsight
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between American and AnalytixInsight is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding American Express and AnalytixInsight in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AnalytixInsight 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 AnalytixInsight. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AnalytixInsight has no effect on the direction of American Express i.e., American Express and AnalytixInsight go up and down completely randomly.
Pair Corralation between American Express and AnalytixInsight
Considering the 90-day investment horizon American Express is expected to generate 0.1 times more return on investment than AnalytixInsight. However, American Express is 10.36 times less risky than AnalytixInsight. It trades about 0.26 of its potential returns per unit of risk. AnalytixInsight is currently generating about 0.01 per unit of risk. If you would invest 27,147 in American Express on August 27, 2024 and sell it today you would earn a total of 2,983 from holding American Express or generate 10.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
American Express vs. AnalytixInsight
Performance |
| Timeline |
| American Express |
| AnalytixInsight |
American Express and AnalytixInsight Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Express and AnalytixInsight
The main advantage of trading using opposite American Express and AnalytixInsight positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Express position performs unexpectedly, AnalytixInsight 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 AnalytixInsight will offset losses from the drop in AnalytixInsight's long position.| American Express vs. SLM Corp | American Express vs. Orix Corp Ads | American Express vs. FirstCash | American Express vs. Medallion Financial Corp |
| AnalytixInsight vs. Boxlight Corp Class | AnalytixInsight vs. Siyata Mobile | AnalytixInsight vs. ClearOne | AnalytixInsight vs. HUMANA INC |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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