Correlation Between Aim Investment and Amer Beacon
Can any of the company-specific risk be diversified away by investing in both Aim Investment and Amer Beacon 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 Aim Investment and Amer Beacon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aim Investment Secs and Amer Beacon Garcia, you can compare the effects of market volatilities on Aim Investment and Amer Beacon 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 Aim Investment with a short position of Amer Beacon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aim Investment and Amer Beacon.
Diversification Opportunities for Aim Investment and Amer Beacon
-0.79 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Aim and Amer is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding Aim Investment Secs and Amer Beacon Garcia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amer Beacon Garcia and Aim Investment 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 Aim Investment Secs are associated (or correlated) with Amer Beacon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amer Beacon Garcia has no effect on the direction of Aim Investment i.e., Aim Investment and Amer Beacon go up and down completely randomly.
Pair Corralation between Aim Investment and Amer Beacon
Assuming the 90 days horizon Aim Investment is expected to generate 2.53 times less return on investment than Amer Beacon. But when comparing it to its historical volatility, Aim Investment Secs is 3.76 times less risky than Amer Beacon. It trades about 0.12 of its potential returns per unit of risk. Amer Beacon Garcia is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 823.00 in Amer Beacon Garcia on September 3, 2024 and sell it today you would earn a total of 42.00 from holding Amer Beacon Garcia or generate 5.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aim Investment Secs vs. Amer Beacon Garcia
Performance |
| Timeline |
| Aim Investment Secs |
| Amer Beacon Garcia |
Aim Investment and Amer Beacon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aim Investment and Amer Beacon
The main advantage of trading using opposite Aim Investment and Amer Beacon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aim Investment position performs unexpectedly, Amer Beacon 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 Amer Beacon will offset losses from the drop in Amer Beacon's long position.| Aim Investment vs. Fidelity Advisor Gold | Aim Investment vs. Great West Goldman Sachs | Aim Investment vs. Invesco Gold Special | Aim Investment vs. Gabelli Gold Fund |
| Amer Beacon vs. Semiconductor Ultrasector Profund | Amer Beacon vs. T Rowe Price | Amer Beacon vs. Growth Strategy Fund | Amer Beacon vs. Fm Investments Large |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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