Correlation Between Ecclesiastical Insurance and Ams AG
Can any of the company-specific risk be diversified away by investing in both Ecclesiastical Insurance and Ams AG 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 Ecclesiastical Insurance and Ams AG into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ecclesiastical Insurance Office and Ams AG, you can compare the effects of market volatilities on Ecclesiastical Insurance and Ams AG 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 Ecclesiastical Insurance with a short position of Ams AG. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ecclesiastical Insurance and Ams AG.
Diversification Opportunities for Ecclesiastical Insurance and Ams AG
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Ecclesiastical and Ams is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Ecclesiastical Insurance Offic and Ams AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ams AG and Ecclesiastical Insurance 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 Ecclesiastical Insurance Office are associated (or correlated) with Ams AG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ams AG has no effect on the direction of Ecclesiastical Insurance i.e., Ecclesiastical Insurance and Ams AG go up and down completely randomly.
Pair Corralation between Ecclesiastical Insurance and Ams AG
Assuming the 90 days trading horizon Ecclesiastical Insurance Office is expected to under-perform the Ams AG. But the stock apears to be less risky and, when comparing its historical volatility, Ecclesiastical Insurance Office is 4.17 times less risky than Ams AG. The stock trades about -0.02 of its potential returns per unit of risk. The Ams AG is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 713.00 in Ams AG on September 12, 2024 and sell it today you would lose (12.00) from holding Ams AG or give up 1.68% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ecclesiastical Insurance Offic vs. Ams AG
Performance |
| Timeline |
| Ecclesiastical Insurance |
| Ams AG |
Ecclesiastical Insurance and Ams AG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ecclesiastical Insurance and Ams AG
The main advantage of trading using opposite Ecclesiastical Insurance and Ams AG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ecclesiastical Insurance position performs unexpectedly, Ams AG 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 Ams AG will offset losses from the drop in Ams AG's long position.| Ecclesiastical Insurance vs. Samsung Electronics Co | Ecclesiastical Insurance vs. Samsung Electronics Co | Ecclesiastical Insurance vs. Hyundai Motor | Ecclesiastical Insurance vs. Toyota Motor Corp |
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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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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