Correlation Between American Express and 594918BL7
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By analyzing existing cross correlation between American Express and MICROSOFT P 445, you can compare the effects of market volatilities on American Express and 594918BL7 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 594918BL7. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Express and 594918BL7.
Diversification Opportunities for American Express and 594918BL7
-0.78 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between American and 594918BL7 is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding American Express and MICROSOFT P 445 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MICROSOFT P 445 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 594918BL7. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MICROSOFT P 445 has no effect on the direction of American Express i.e., American Express and 594918BL7 go up and down completely randomly.
Pair Corralation between American Express and 594918BL7
Considering the 90-day investment horizon American Express is expected to generate 1.75 times more return on investment than 594918BL7. However, American Express is 1.75 times more volatile than MICROSOFT P 445. It trades about 0.13 of its potential returns per unit of risk. MICROSOFT P 445 is currently generating about 0.01 per unit of risk. If you would invest 23,590 in American Express on August 28, 2024 and sell it today you would earn a total of 6,931 from holding American Express or generate 29.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 97.62% |
| Values | Daily Returns |
American Express vs. MICROSOFT P 445
Performance |
| Timeline |
| American Express |
| MICROSOFT P 445 |
American Express and 594918BL7 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Express and 594918BL7
The main advantage of trading using opposite American Express and 594918BL7 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Express position performs unexpectedly, 594918BL7 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 594918BL7 will offset losses from the drop in 594918BL7'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 |
| 594918BL7 vs. The Coca Cola | 594918BL7 vs. JPMorgan Chase Co | 594918BL7 vs. Dupont De Nemours | 594918BL7 vs. Alcoa Corp |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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