Correlation Between Hood River and Amg Southernsun
Can any of the company-specific risk be diversified away by investing in both Hood River and Amg Southernsun 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 Hood River and Amg Southernsun into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hood River New and Amg Southernsun Small, you can compare the effects of market volatilities on Hood River and Amg Southernsun 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 Hood River with a short position of Amg Southernsun. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hood River and Amg Southernsun.
Diversification Opportunities for Hood River and Amg Southernsun
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Hood and Amg is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Hood River New and Amg Southernsun Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amg Southernsun Small and Hood River 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 Hood River New are associated (or correlated) with Amg Southernsun. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amg Southernsun Small has no effect on the direction of Hood River i.e., Hood River and Amg Southernsun go up and down completely randomly.
Pair Corralation between Hood River and Amg Southernsun
Assuming the 90 days horizon Hood River New is expected to generate 1.08 times more return on investment than Amg Southernsun. However, Hood River is 1.08 times more volatile than Amg Southernsun Small. It trades about 0.36 of its potential returns per unit of risk. Amg Southernsun Small is currently generating about 0.2 per unit of risk. If you would invest 1,245 in Hood River New on August 27, 2024 and sell it today you would earn a total of 151.00 from holding Hood River New or generate 12.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hood River New vs. Amg Southernsun Small
Performance |
| Timeline |
| Hood River New |
| Amg Southernsun Small |
Hood River and Amg Southernsun Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hood River and Amg Southernsun
The main advantage of trading using opposite Hood River and Amg Southernsun positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hood River position performs unexpectedly, Amg Southernsun 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 Amg Southernsun will offset losses from the drop in Amg Southernsun's long position.| Hood River vs. Lord Abbett Government | Hood River vs. John Hancock Government | Hood River vs. Ab Government Exchange | Hood River vs. Blackrock Government Bond |
| Amg Southernsun vs. American Beacon Bridgeway | Amg Southernsun vs. John Hancock Disciplined | Amg Southernsun vs. Large Cap Fund | Amg Southernsun vs. Baird E Plus |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
Other Complementary Tools
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Equity Valuation Check real value of public entities based on technical and fundamental data |