Correlation Between American Express and Athenex
Can any of the company-specific risk be diversified away by investing in both American Express and Athenex 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 Athenex into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Express and Athenex, you can compare the effects of market volatilities on American Express and Athenex 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 Athenex. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Express and Athenex.
Diversification Opportunities for American Express and Athenex
-0.85 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between American and Athenex is -0.85. Overlapping area represents the amount of risk that can be diversified away by holding American Express and Athenex in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Athenex 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 Athenex. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Athenex has no effect on the direction of American Express i.e., American Express and Athenex go up and down completely randomly.
Pair Corralation between American Express and Athenex
If you would invest 26,998 in American Express on August 25, 2024 and sell it today you would earn a total of 3,132 from holding American Express or generate 11.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 4.55% |
| Values | Daily Returns |
American Express vs. Athenex
Performance |
| Timeline |
| American Express |
| Athenex |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
American Express and Athenex Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Express and Athenex
The main advantage of trading using opposite American Express and Athenex positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Express position performs unexpectedly, Athenex 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 Athenex will offset losses from the drop in Athenex's long position.| American Express vs. Visa Class A | American Express vs. Mastercard | American Express vs. SoFi Technologies | American Express vs. Coca Cola Consolidated |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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