Correlation Between American Express and Eagle Mid
Can any of the company-specific risk be diversified away by investing in both American Express and Eagle Mid 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 Eagle Mid into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Express and Eagle Mid Cap, you can compare the effects of market volatilities on American Express and Eagle Mid 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 Eagle Mid. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Express and Eagle Mid.
Diversification Opportunities for American Express and Eagle Mid
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between American and Eagle is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding American Express and Eagle Mid Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eagle Mid Cap 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 Eagle Mid. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eagle Mid Cap has no effect on the direction of American Express i.e., American Express and Eagle Mid go up and down completely randomly.
Pair Corralation between American Express and Eagle Mid
If you would invest 27,019 in American Express on September 4, 2024 and sell it today you would earn a total of 3,192 from holding American Express or generate 11.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 4.76% |
| Values | Daily Returns |
American Express vs. Eagle Mid Cap
Performance |
| Timeline |
| American Express |
| Eagle Mid Cap |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
American Express and Eagle Mid Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Express and Eagle Mid
The main advantage of trading using opposite American Express and Eagle Mid positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Express position performs unexpectedly, Eagle Mid 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 Eagle Mid will offset losses from the drop in Eagle Mid's long position.| American Express vs. 360 Finance | American Express vs. Enova International | American Express vs. X Financial Class | American Express vs. LendingClub Corp |
| Eagle Mid vs. Dunham Large Cap | Eagle Mid vs. Avantis Large Cap | Eagle Mid vs. Vanguard Windsor Fund | Eagle Mid vs. Qs Large Cap |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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