Correlation Between American States and MYFAIR GOLD
Can any of the company-specific risk be diversified away by investing in both American States and MYFAIR GOLD 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 American States and MYFAIR GOLD into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American States Water and MYFAIR GOLD P, you can compare the effects of market volatilities on American States and MYFAIR GOLD 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 States with a short position of MYFAIR GOLD. Check out your portfolio center. Please also check ongoing floating volatility patterns of American States and MYFAIR GOLD.
Diversification Opportunities for American States and MYFAIR GOLD
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between American and MYFAIR is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding American States Water and MYFAIR GOLD P in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MYFAIR GOLD P and American States 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 States Water are associated (or correlated) with MYFAIR GOLD. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MYFAIR GOLD P has no effect on the direction of American States i.e., American States and MYFAIR GOLD go up and down completely randomly.
Pair Corralation between American States and MYFAIR GOLD
Assuming the 90 days horizon American States Water is expected to generate 0.27 times more return on investment than MYFAIR GOLD. However, American States Water is 3.67 times less risky than MYFAIR GOLD. It trades about 0.21 of its potential returns per unit of risk. MYFAIR GOLD P is currently generating about -0.14 per unit of risk. If you would invest 7,496 in American States Water on September 1, 2024 and sell it today you would earn a total of 529.00 from holding American States Water or generate 7.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
American States Water vs. MYFAIR GOLD P
Performance |
| Timeline |
| American States Water |
| MYFAIR GOLD P |
American States and MYFAIR GOLD Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American States and MYFAIR GOLD
The main advantage of trading using opposite American States and MYFAIR GOLD positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American States position performs unexpectedly, MYFAIR GOLD 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 MYFAIR GOLD will offset losses from the drop in MYFAIR GOLD's long position.| American States vs. MYFAIR GOLD P | American States vs. Calibre Mining Corp | American States vs. DELTA AIR LINES | American States vs. VIVA WINE GROUP |
| MYFAIR GOLD vs. PLAYTIKA HOLDING DL 01 | MYFAIR GOLD vs. CNVISION MEDIA | MYFAIR GOLD vs. Dave Busters Entertainment | MYFAIR GOLD vs. STORE ELECTRONIC |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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