Correlation Between American Express and INTERNATIONAL
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By analyzing existing cross correlation between American Express and INTERNATIONAL BUSINESS MACHS, you can compare the effects of market volatilities on American Express and INTERNATIONAL 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 INTERNATIONAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Express and INTERNATIONAL.
Diversification Opportunities for American Express and INTERNATIONAL
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between American and INTERNATIONAL is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding American Express and INTERNATIONAL BUSINESS MACHS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on INTERNATIONAL BUSINESS 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 INTERNATIONAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of INTERNATIONAL BUSINESS has no effect on the direction of American Express i.e., American Express and INTERNATIONAL go up and down completely randomly.
Pair Corralation between American Express and INTERNATIONAL
Considering the 90-day investment horizon American Express is expected to generate 1.6 times more return on investment than INTERNATIONAL. However, American Express is 1.6 times more volatile than INTERNATIONAL BUSINESS MACHS. It trades about 0.29 of its potential returns per unit of risk. INTERNATIONAL BUSINESS MACHS is currently generating about -0.14 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 3,410 from holding American Express or generate 12.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
American Express vs. INTERNATIONAL BUSINESS MACHS
Performance |
| Timeline |
| American Express |
| INTERNATIONAL BUSINESS |
American Express and INTERNATIONAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Express and INTERNATIONAL
The main advantage of trading using opposite American Express and INTERNATIONAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Express position performs unexpectedly, INTERNATIONAL 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 INTERNATIONAL will offset losses from the drop in INTERNATIONAL's long position.| American Express vs. Orix Corp Ads | American Express vs. Medallion Financial Corp | American Express vs. Oportun Financial Corp | American Express vs. SLM Corp Pb |
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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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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