Correlation Between IPG Photonics and Amrica Mvil
Can any of the company-specific risk be diversified away by investing in both IPG Photonics and Amrica Mvil 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 IPG Photonics and Amrica Mvil into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between IPG Photonics and Amrica Mvil SAB, you can compare the effects of market volatilities on IPG Photonics and Amrica Mvil 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 IPG Photonics with a short position of Amrica Mvil. Check out your portfolio center. Please also check ongoing floating volatility patterns of IPG Photonics and Amrica Mvil.
Diversification Opportunities for IPG Photonics and Amrica Mvil
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between IPG and Amrica is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding IPG Photonics and Amrica Mvil SAB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amrica Mvil SAB and IPG Photonics 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 IPG Photonics are associated (or correlated) with Amrica Mvil. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amrica Mvil SAB has no effect on the direction of IPG Photonics i.e., IPG Photonics and Amrica Mvil go up and down completely randomly.
Pair Corralation between IPG Photonics and Amrica Mvil
If you would invest 7,445 in IPG Photonics on October 20, 2024 and sell it today you would lose (5.00) from holding IPG Photonics or give up 0.07% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 5.0% |
| Values | Daily Returns |
IPG Photonics vs. Amrica Mvil SAB
Performance |
| Timeline |
| IPG Photonics |
| Amrica Mvil SAB |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
IPG Photonics and Amrica Mvil Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IPG Photonics and Amrica Mvil
The main advantage of trading using opposite IPG Photonics and Amrica Mvil positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IPG Photonics position performs unexpectedly, Amrica Mvil 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 Amrica Mvil will offset losses from the drop in Amrica Mvil's long position.| IPG Photonics vs. Teradyne | IPG Photonics vs. Ultra Clean Holdings | IPG Photonics vs. Onto Innovation | IPG Photonics vs. Cohu Inc |
| Amrica Mvil vs. Viemed Healthcare | Amrica Mvil vs. KLA Tencor | Amrica Mvil vs. Genfit | Amrica Mvil vs. IPG Photonics |
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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