Correlation Between American Express and SANDS
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By analyzing existing cross correlation between American Express and SANDS CHINA LTD, you can compare the effects of market volatilities on American Express and SANDS 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 SANDS. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Express and SANDS.
Diversification Opportunities for American Express and SANDS
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between American and SANDS is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding American Express and SANDS CHINA LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SANDS CHINA LTD 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 SANDS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SANDS CHINA LTD has no effect on the direction of American Express i.e., American Express and SANDS go up and down completely randomly.
Pair Corralation between American Express and SANDS
Considering the 90-day investment horizon American Express is expected to generate 6.75 times more return on investment than SANDS. However, American Express is 6.75 times more volatile than SANDS CHINA LTD. It trades about 0.17 of its potential returns per unit of risk. SANDS CHINA LTD is currently generating about -0.12 per unit of risk. If you would invest 25,642 in American Express on August 28, 2024 and sell it today you would earn a total of 4,879 from holding American Express or generate 19.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 93.75% |
| Values | Daily Returns |
American Express vs. SANDS CHINA LTD
Performance |
| Timeline |
| American Express |
| SANDS CHINA LTD |
American Express and SANDS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Express and SANDS
The main advantage of trading using opposite American Express and SANDS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Express position performs unexpectedly, SANDS 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 SANDS will offset losses from the drop in SANDS'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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