Correlation Between American Express and Invesco Global
Can any of the company-specific risk be diversified away by investing in both American Express and Invesco Global 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 Invesco Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Express and Invesco Global Listed, you can compare the effects of market volatilities on American Express and Invesco Global 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 Invesco Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Express and Invesco Global.
Diversification Opportunities for American Express and Invesco Global
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between American and Invesco is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding American Express and Invesco Global Listed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Invesco Global Listed 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 Invesco Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Invesco Global Listed has no effect on the direction of American Express i.e., American Express and Invesco Global go up and down completely randomly.
Pair Corralation between American Express and Invesco Global
Considering the 90-day investment horizon American Express is expected to generate 1.26 times more return on investment than Invesco Global. However, American Express is 1.26 times more volatile than Invesco Global Listed. It trades about 0.09 of its potential returns per unit of risk. Invesco Global Listed is currently generating about 0.08 per unit of risk. If you would invest 15,264 in American Express on August 23, 2024 and sell it today you would earn a total of 14,036 from holding American Express or generate 91.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
American Express vs. Invesco Global Listed
Performance |
| Timeline |
| American Express |
| Invesco Global Listed |
American Express and Invesco Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Express and Invesco Global
The main advantage of trading using opposite American Express and Invesco Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Express position performs unexpectedly, Invesco Global 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 Invesco Global will offset losses from the drop in Invesco Global's long position.| American Express vs. Small Cap Core | American Express vs. Morningstar Unconstrained Allocation | American Express vs. Mutual Of America | American Express vs. Ep Emerging Markets |
| Invesco Global vs. Invesco WilderHill Clean | Invesco Global vs. First Trust Global | Invesco Global vs. First Trust NASDAQ | Invesco Global vs. ALPS Clean Energy |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
Other Complementary Tools
| Stocks Directory Find actively traded stocks across global markets | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities |