Correlation Between American Express and Biostage
Can any of the company-specific risk be diversified away by investing in both American Express and Biostage 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 Biostage into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Express and Biostage, you can compare the effects of market volatilities on American Express and Biostage 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 Biostage. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Express and Biostage.
Diversification Opportunities for American Express and Biostage
-0.79 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between American and Biostage is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding American Express and Biostage in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Biostage 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 Biostage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Biostage has no effect on the direction of American Express i.e., American Express and Biostage go up and down completely randomly.
Pair Corralation between American Express and Biostage
If you would invest 27,408 in American Express on August 31, 2024 and sell it today you would earn a total of 3,017 from holding American Express or generate 11.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 4.55% |
| Values | Daily Returns |
American Express vs. Biostage
Performance |
| Timeline |
| American Express |
| Biostage |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
American Express and Biostage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Express and Biostage
The main advantage of trading using opposite American Express and Biostage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Express position performs unexpectedly, Biostage 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 Biostage will offset losses from the drop in Biostage's long position.| American Express vs. Visa Class A | American Express vs. RLJ Lodging Trust | American Express vs. Aquagold International | American Express vs. Stepstone Group |
| Biostage vs. Biotron Limited | Biostage vs. biOasis Technologies | Biostage vs. Covalon Technologies | Biostage vs. Mosaic Immunoengineering |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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