Correlation Between Jiangsu Expressway and Amgen
Can any of the company-specific risk be diversified away by investing in both Jiangsu Expressway and Amgen 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 Jiangsu Expressway and Amgen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jiangsu Expressway and Amgen Inc, you can compare the effects of market volatilities on Jiangsu Expressway and Amgen 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 Jiangsu Expressway with a short position of Amgen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiangsu Expressway and Amgen.
Diversification Opportunities for Jiangsu Expressway and Amgen
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between Jiangsu and Amgen is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Jiangsu Expressway and Amgen Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amgen Inc and Jiangsu Expressway 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 Jiangsu Expressway are associated (or correlated) with Amgen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amgen Inc has no effect on the direction of Jiangsu Expressway i.e., Jiangsu Expressway and Amgen go up and down completely randomly.
Pair Corralation between Jiangsu Expressway and Amgen
Assuming the 90 days horizon Jiangsu Expressway is expected to generate 1.23 times less return on investment than Amgen. But when comparing it to its historical volatility, Jiangsu Expressway is 1.62 times less risky than Amgen. It trades about 0.23 of its potential returns per unit of risk. Amgen Inc is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 26,338 in Amgen Inc on October 21, 2024 and sell it today you would earn a total of 873.00 from holding Amgen Inc or generate 3.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jiangsu Expressway vs. Amgen Inc
Performance |
| Timeline |
| Jiangsu Expressway |
| Amgen Inc |
Jiangsu Expressway and Amgen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jiangsu Expressway and Amgen
The main advantage of trading using opposite Jiangsu Expressway and Amgen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiangsu Expressway position performs unexpectedly, Amgen 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 Amgen will offset losses from the drop in Amgen's long position.| Jiangsu Expressway vs. BJs Restaurants | Jiangsu Expressway vs. Vistra Energy Corp | Jiangsu Expressway vs. GE Vernova LLC | Jiangsu Expressway vs. RCI Hospitality Holdings |
| Amgen vs. Agilent Technologies | Amgen vs. Equillium | Amgen vs. 23Andme Holding Co | Amgen vs. DiaMedica Therapeutics |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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