Correlation Between Strategic Investments and Ameriprise Financial
Can any of the company-specific risk be diversified away by investing in both Strategic Investments and Ameriprise Financial 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 Strategic Investments and Ameriprise Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Strategic Investments AS and Ameriprise Financial, you can compare the effects of market volatilities on Strategic Investments and Ameriprise Financial 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 Strategic Investments with a short position of Ameriprise Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Strategic Investments and Ameriprise Financial.
Diversification Opportunities for Strategic Investments and Ameriprise Financial
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Strategic and Ameriprise is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Strategic Investments AS and Ameriprise Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ameriprise Financial and Strategic Investments 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 Strategic Investments AS are associated (or correlated) with Ameriprise Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ameriprise Financial has no effect on the direction of Strategic Investments i.e., Strategic Investments and Ameriprise Financial go up and down completely randomly.
Pair Corralation between Strategic Investments and Ameriprise Financial
Assuming the 90 days horizon Strategic Investments AS is expected to under-perform the Ameriprise Financial. In addition to that, Strategic Investments is 2.19 times more volatile than Ameriprise Financial. It trades about -0.31 of its total potential returns per unit of risk. Ameriprise Financial is currently generating about -0.22 per unit of volatility. If you would invest 53,040 in Ameriprise Financial on September 20, 2024 and sell it today you would lose (2,560) from holding Ameriprise Financial or give up 4.83% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Strategic Investments AS vs. Ameriprise Financial
Performance |
| Timeline |
| Strategic Investments |
| Ameriprise Financial |
Strategic Investments and Ameriprise Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Strategic Investments and Ameriprise Financial
The main advantage of trading using opposite Strategic Investments and Ameriprise Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Strategic Investments position performs unexpectedly, Ameriprise Financial 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 Ameriprise Financial will offset losses from the drop in Ameriprise Financial's long position.| Strategic Investments vs. Ameriprise Financial | Strategic Investments vs. Ares Management Corp | Strategic Investments vs. Superior Plus Corp | Strategic Investments vs. SIVERS SEMICONDUCTORS AB |
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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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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