Correlation Between American Express and 81725WAL7
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By analyzing existing cross correlation between American Express and ST 5875 01 SEP 30, you can compare the effects of market volatilities on American Express and 81725WAL7 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 81725WAL7. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Express and 81725WAL7.
Diversification Opportunities for American Express and 81725WAL7
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between American and 81725WAL7 is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding American Express and ST 5875 01 SEP 30 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ST 5875 01 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 81725WAL7. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ST 5875 01 has no effect on the direction of American Express i.e., American Express and 81725WAL7 go up and down completely randomly.
Pair Corralation between American Express and 81725WAL7
Considering the 90-day investment horizon American Express is expected to generate 2.88 times more return on investment than 81725WAL7. However, American Express is 2.88 times more volatile than ST 5875 01 SEP 30. It trades about 0.1 of its potential returns per unit of risk. ST 5875 01 SEP 30 is currently generating about 0.0 per unit of risk. If you would invest 14,696 in American Express on August 31, 2024 and sell it today you would earn a total of 15,772 from holding American Express or generate 107.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 81.38% |
| Values | Daily Returns |
American Express vs. ST 5875 01 SEP 30
Performance |
| Timeline |
| American Express |
| ST 5875 01 |
American Express and 81725WAL7 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Express and 81725WAL7
The main advantage of trading using opposite American Express and 81725WAL7 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Express position performs unexpectedly, 81725WAL7 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 81725WAL7 will offset losses from the drop in 81725WAL7's long position.| American Express vs. Visa Class A | American Express vs. RLJ Lodging Trust | American Express vs. Aquagold International | American Express vs. Stepstone Group |
| 81725WAL7 vs. ATT Inc | 81725WAL7 vs. Home Depot | 81725WAL7 vs. Cisco Systems | 81725WAL7 vs. Dupont De Nemours |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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