Correlation Between SPTSX Dividend and AMERICAN EXPRESS
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By analyzing existing cross correlation between SPTSX Dividend Aristocrats and AMERICAN EXPRESS CDR, you can compare the effects of market volatilities on SPTSX Dividend and AMERICAN EXPRESS 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 SPTSX Dividend with a short position of AMERICAN EXPRESS. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPTSX Dividend and AMERICAN EXPRESS.
Diversification Opportunities for SPTSX Dividend and AMERICAN EXPRESS
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SPTSX and AMERICAN is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding SPTSX Dividend Aristocrats and AMERICAN EXPRESS CDR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AMERICAN EXPRESS CDR and SPTSX Dividend 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 SPTSX Dividend Aristocrats are associated (or correlated) with AMERICAN EXPRESS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AMERICAN EXPRESS CDR has no effect on the direction of SPTSX Dividend i.e., SPTSX Dividend and AMERICAN EXPRESS go up and down completely randomly.
Pair Corralation between SPTSX Dividend and AMERICAN EXPRESS
Assuming the 90 days trading horizon SPTSX Dividend is expected to generate 5.88 times less return on investment than AMERICAN EXPRESS. But when comparing it to its historical volatility, SPTSX Dividend Aristocrats is 5.07 times less risky than AMERICAN EXPRESS. It trades about 0.2 of its potential returns per unit of risk. AMERICAN EXPRESS CDR is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 2,388 in AMERICAN EXPRESS CDR on August 30, 2024 and sell it today you would earn a total of 296.00 from holding AMERICAN EXPRESS CDR or generate 12.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SPTSX Dividend Aristocrats vs. AMERICAN EXPRESS CDR
Performance |
| Timeline |
SPTSX Dividend and AMERICAN EXPRESS Volatility Contrast
Predicted Return Density |
| Returns |
SPTSX Dividend Aristocrats
Pair trading matchups for SPTSX Dividend
AMERICAN EXPRESS CDR
Pair trading matchups for AMERICAN EXPRESS
Pair Trading with SPTSX Dividend and AMERICAN EXPRESS
The main advantage of trading using opposite SPTSX Dividend and AMERICAN EXPRESS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPTSX Dividend position performs unexpectedly, AMERICAN EXPRESS 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 AMERICAN EXPRESS will offset losses from the drop in AMERICAN EXPRESS's long position.| SPTSX Dividend vs. Metalero Mining Corp | SPTSX Dividend vs. Marimaca Copper Corp | SPTSX Dividend vs. Network Media Group | SPTSX Dividend vs. Nicola Mining |
| AMERICAN EXPRESS vs. Guru Organic Energy | AMERICAN EXPRESS vs. Westshore Terminals Investment | AMERICAN EXPRESS vs. Upstart Investments | AMERICAN EXPRESS vs. Canadian Utilities Limited |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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