Correlation Between American Express and Biloxi Marsh
Can any of the company-specific risk be diversified away by investing in both American Express and Biloxi Marsh 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 Biloxi Marsh into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Express and Biloxi Marsh Lands, you can compare the effects of market volatilities on American Express and Biloxi Marsh 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 Biloxi Marsh. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Express and Biloxi Marsh.
Diversification Opportunities for American Express and Biloxi Marsh
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between American and Biloxi is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding American Express and Biloxi Marsh Lands in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Biloxi Marsh Lands 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 Biloxi Marsh. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Biloxi Marsh Lands has no effect on the direction of American Express i.e., American Express and Biloxi Marsh go up and down completely randomly.
Pair Corralation between American Express and Biloxi Marsh
Considering the 90-day investment horizon American Express is expected to generate 0.52 times more return on investment than Biloxi Marsh. However, American Express is 1.94 times less risky than Biloxi Marsh. It trades about 0.09 of its potential returns per unit of risk. Biloxi Marsh Lands is currently generating about 0.01 per unit of risk. If you would invest 15,339 in American Express on September 3, 2024 and sell it today you would earn a total of 14,887 from holding American Express or generate 97.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 80.4% |
| Values | Daily Returns |
American Express vs. Biloxi Marsh Lands
Performance |
| Timeline |
| American Express |
| Biloxi Marsh Lands |
American Express and Biloxi Marsh Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Express and Biloxi Marsh
The main advantage of trading using opposite American Express and Biloxi Marsh positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Express position performs unexpectedly, Biloxi Marsh 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 Biloxi Marsh will offset losses from the drop in Biloxi Marsh's long position.| American Express vs. Highway Holdings Limited | American Express vs. QCR Holdings | American Express vs. Partner Communications | American Express vs. Acumen Pharmaceuticals |
| Biloxi Marsh vs. Horizon Oil Limited | Biloxi Marsh vs. Gulf Keystone Petroleum | Biloxi Marsh vs. Cross Timbers Royalty | Biloxi Marsh vs. San Juan Basin |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
Other Complementary Tools
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets |