Correlation Between Intuitive Investments and American Express
Can any of the company-specific risk be diversified away by investing in both Intuitive Investments and American Express 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 Intuitive Investments and American Express into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Intuitive Investments Group and American Express Co, you can compare the effects of market volatilities on Intuitive Investments 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 Intuitive Investments with a short position of American Express. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intuitive Investments and American Express.
Diversification Opportunities for Intuitive Investments and American Express
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Intuitive and American is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Intuitive Investments Group and American Express Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Express and Intuitive Investments 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 Intuitive Investments Group 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 has no effect on the direction of Intuitive Investments i.e., Intuitive Investments and American Express go up and down completely randomly.
Pair Corralation between Intuitive Investments and American Express
Assuming the 90 days trading horizon Intuitive Investments Group is expected to generate 3.57 times more return on investment than American Express. However, Intuitive Investments is 3.57 times more volatile than American Express Co. It trades about 0.04 of its potential returns per unit of risk. American Express Co is currently generating about 0.1 per unit of risk. If you would invest 7,375 in Intuitive Investments Group on October 11, 2024 and sell it today you would earn a total of 4,825 from holding Intuitive Investments Group or generate 65.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 98.59% |
| Values | Daily Returns |
Intuitive Investments Group vs. American Express Co
Performance |
| Timeline |
| Intuitive Investments |
| American Express |
Intuitive Investments and American Express Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Intuitive Investments and American Express
The main advantage of trading using opposite Intuitive Investments and American Express positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intuitive Investments 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' long position.| Intuitive Investments vs. Fevertree Drinks Plc | Intuitive Investments vs. Premier Foods PLC | Intuitive Investments vs. Ebro Foods | Intuitive Investments vs. Supermarket Income REIT |
| American Express vs. Omega Healthcare Investors | American Express vs. Bellevue Healthcare Trust | American Express vs. Abingdon Health Plc | American Express vs. Naturhouse Health SA |
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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