Correlation Between American Express and Mawson Infrastructure
Can any of the company-specific risk be diversified away by investing in both American Express and Mawson Infrastructure 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 Mawson Infrastructure into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Express and Mawson Infrastructure Group, you can compare the effects of market volatilities on American Express and Mawson Infrastructure 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 Mawson Infrastructure. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Express and Mawson Infrastructure.
Diversification Opportunities for American Express and Mawson Infrastructure
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between American and Mawson is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding American Express and Mawson Infrastructure Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mawson Infrastructure 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 Mawson Infrastructure. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mawson Infrastructure has no effect on the direction of American Express i.e., American Express and Mawson Infrastructure go up and down completely randomly.
Pair Corralation between American Express and Mawson Infrastructure
Considering the 90-day investment horizon American Express is expected to generate 0.29 times more return on investment than Mawson Infrastructure. However, American Express is 3.42 times less risky than Mawson Infrastructure. It trades about -0.33 of its potential returns per unit of risk. Mawson Infrastructure Group is currently generating about -0.7 per unit of risk. If you would invest 31,642 in American Express on November 28, 2024 and sell it today you would lose (2,308) from holding American Express or give up 7.29% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
American Express vs. Mawson Infrastructure Group
Performance |
| Timeline |
| American Express |
| Mawson Infrastructure |
American Express and Mawson Infrastructure Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Express and Mawson Infrastructure
The main advantage of trading using opposite American Express and Mawson Infrastructure positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Express position performs unexpectedly, Mawson Infrastructure 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 Mawson Infrastructure will offset losses from the drop in Mawson Infrastructure's long position.| American Express vs. LM Funding America | American Express vs. Eason Technology Limited | American Express vs. Nisun International Enterprise | American Express vs. Qudian Inc |
| Mawson Infrastructure vs. Terawulf | Mawson Infrastructure vs. Iris Energy | Mawson Infrastructure vs. Stronghold Digital Mining | Mawson Infrastructure vs. Argo Blockchain PLC |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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