Correlation Between American Express and Molina
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By analyzing existing cross correlation between American Express and Molina Healthcare 4375, you can compare the effects of market volatilities on American Express and Molina 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 Molina. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Express and Molina.
Diversification Opportunities for American Express and Molina
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between American and Molina is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding American Express and Molina Healthcare 4375 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Molina Healthcare 4375 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 Molina. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Molina Healthcare 4375 has no effect on the direction of American Express i.e., American Express and Molina go up and down completely randomly.
Pair Corralation between American Express and Molina
Considering the 90-day investment horizon American Express is expected to generate 4.96 times more return on investment than Molina. However, American Express is 4.96 times more volatile than Molina Healthcare 4375. It trades about 0.17 of its potential returns per unit of risk. Molina Healthcare 4375 is currently generating about -0.05 per unit of risk. If you would invest 27,035 in American Express on August 28, 2024 and sell it today you would earn a total of 3,486 from holding American Express or generate 12.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
American Express vs. Molina Healthcare 4375
Performance |
| Timeline |
| American Express |
| Molina Healthcare 4375 |
American Express and Molina Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Express and Molina
The main advantage of trading using opposite American Express and Molina positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Express position performs unexpectedly, Molina 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 Molina will offset losses from the drop in Molina's long position.| American Express vs. SLM Corp | American Express vs. Orix Corp Ads | American Express vs. FirstCash | American Express vs. Medallion Financial Corp |
| Molina vs. AEP TEX INC | Molina vs. US BANK NATIONAL | Molina vs. Eat Beyond Global | Molina vs. Charles Schwab 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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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