Correlation Between American Express and Entegris
Can any of the company-specific risk be diversified away by investing in both American Express and Entegris 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 Entegris into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Express and Entegris, you can compare the effects of market volatilities on American Express and Entegris 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 Entegris. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Express and Entegris.
Diversification Opportunities for American Express and Entegris
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between American and Entegris is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding American Express and Entegris in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Entegris 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 Entegris. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Entegris has no effect on the direction of American Express i.e., American Express and Entegris go up and down completely randomly.
Pair Corralation between American Express and Entegris
Considering the 90-day investment horizon American Express is expected to generate 0.75 times more return on investment than Entegris. However, American Express is 1.33 times less risky than Entegris. It trades about 0.28 of its potential returns per unit of risk. Entegris is currently generating about -0.05 per unit of risk. If you would invest 27,043 in American Express on August 30, 2024 and sell it today you would earn a total of 3,382 from holding American Express or generate 12.51% 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. Entegris
Performance |
| Timeline |
| American Express |
| Entegris |
American Express and Entegris Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Express and Entegris
The main advantage of trading using opposite American Express and Entegris positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Express position performs unexpectedly, Entegris 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 Entegris will offset losses from the drop in Entegris' long position.| American Express vs. 360 Finance | American Express vs. Atlanticus Holdings | American Express vs. X Financial Class | American Express vs. Yirendai |
| Entegris vs. Teradyne | Entegris vs. Ichor Holdings | Entegris vs. Amtech Systems | Entegris vs. Veeco Instruments |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
Other Complementary Tools
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins |