Correlation Between American Express and MASCO
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By analyzing existing cross correlation between American Express and MASCO P 775, you can compare the effects of market volatilities on American Express and MASCO 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 MASCO. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Express and MASCO.
Diversification Opportunities for American Express and MASCO
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between American and MASCO is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding American Express and MASCO P 775 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MASCO P 775 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 MASCO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MASCO P 775 has no effect on the direction of American Express i.e., American Express and MASCO go up and down completely randomly.
Pair Corralation between American Express and MASCO
Considering the 90-day investment horizon American Express is expected to generate 3.4 times more return on investment than MASCO. However, American Express is 3.4 times more volatile than MASCO P 775. It trades about 0.26 of its potential returns per unit of risk. MASCO P 775 is currently generating about -0.01 per unit of risk. If you would invest 27,147 in American Express on August 27, 2024 and sell it today you would earn a total of 2,983 from holding American Express or generate 10.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 85.71% |
| Values | Daily Returns |
American Express vs. MASCO P 775
Performance |
| Timeline |
| American Express |
| MASCO P 775 |
American Express and MASCO Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Express and MASCO
The main advantage of trading using opposite American Express and MASCO positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Express position performs unexpectedly, MASCO 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 MASCO will offset losses from the drop in MASCO's long position.| American Express vs. SLM Corp | American Express vs. Orix Corp Ads | American Express vs. FirstCash | American Express vs. Medallion Financial Corp |
| MASCO vs. Entravision Communications | MASCO vs. BOS Better Online | MASCO vs. Topbuild Corp | MASCO vs. Inuvo Inc |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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