Correlation Between American Express and 031162DS6
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By analyzing existing cross correlation between American Express and AMGN 56 02 MAR 43, you can compare the effects of market volatilities on American Express and 031162DS6 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 031162DS6. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Express and 031162DS6.
Diversification Opportunities for American Express and 031162DS6
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between American and 031162DS6 is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding American Express and AMGN 56 02 MAR 43 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AMGN 56 02 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 031162DS6. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AMGN 56 02 has no effect on the direction of American Express i.e., American Express and 031162DS6 go up and down completely randomly.
Pair Corralation between American Express and 031162DS6
Considering the 90-day investment horizon American Express is expected to generate 2.47 times more return on investment than 031162DS6. However, American Express is 2.47 times more volatile than AMGN 56 02 MAR 43. It trades about 0.27 of its potential returns per unit of risk. AMGN 56 02 MAR 43 is currently generating about 0.11 per unit of risk. If you would invest 27,147 in American Express on August 29, 2024 and sell it today you would earn a total of 3,278 from holding American Express or generate 12.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
American Express vs. AMGN 56 02 MAR 43
Performance |
| Timeline |
| American Express |
| AMGN 56 02 |
American Express and 031162DS6 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Express and 031162DS6
The main advantage of trading using opposite American Express and 031162DS6 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Express position performs unexpectedly, 031162DS6 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 031162DS6 will offset losses from the drop in 031162DS6's long position.| American Express vs. Visa Class A | American Express vs. Mastercard | American Express vs. Discover Financial Services |
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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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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