Correlation Between AMREP and Parker Hannifin
Can any of the company-specific risk be diversified away by investing in both AMREP and Parker Hannifin at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining AMREP and Parker Hannifin into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AMREP and Parker Hannifin, you can compare the effects of market volatilities on AMREP and Parker Hannifin 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 AMREP with a short position of Parker Hannifin. Check out your portfolio center. Please also check ongoing floating volatility patterns of AMREP and Parker Hannifin.
Diversification Opportunities for AMREP and Parker Hannifin
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between AMREP and Parker is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding AMREP and Parker Hannifin in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Parker Hannifin and AMREP 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 AMREP are associated (or correlated) with Parker Hannifin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Parker Hannifin has no effect on the direction of AMREP i.e., AMREP and Parker Hannifin go up and down completely randomly.
Pair Corralation between AMREP and Parker Hannifin
Considering the 90-day investment horizon AMREP is expected to generate 2.86 times more return on investment than Parker Hannifin. However, AMREP is 2.86 times more volatile than Parker Hannifin. It trades about 0.21 of its potential returns per unit of risk. Parker Hannifin is currently generating about 0.23 per unit of risk. If you would invest 2,210 in AMREP on September 2, 2024 and sell it today you would earn a total of 1,394 from holding AMREP or generate 63.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
AMREP vs. Parker Hannifin
Performance |
| Timeline |
| AMREP |
| Parker Hannifin |
AMREP and Parker Hannifin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AMREP and Parker Hannifin
The main advantage of trading using opposite AMREP and Parker Hannifin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AMREP position performs unexpectedly, Parker Hannifin 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 Parker Hannifin will offset losses from the drop in Parker Hannifin's long position.| AMREP vs. Landsea Homes Corp | AMREP vs. Forestar Group | AMREP vs. Five Point Holdings | AMREP vs. American Realty Investors |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
Other Complementary Tools
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Stocks Directory Find actively traded stocks across global markets | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators |