Correlation Between Japan Post and AmTrust Financial
Can any of the company-specific risk be diversified away by investing in both Japan Post and AmTrust Financial 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 Japan Post and AmTrust Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Japan Post Holdings and AmTrust Financial Services, you can compare the effects of market volatilities on Japan Post and AmTrust Financial 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 Japan Post with a short position of AmTrust Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Japan Post and AmTrust Financial.
Diversification Opportunities for Japan Post and AmTrust Financial
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Japan and AmTrust is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Japan Post Holdings and AmTrust Financial Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AmTrust Financial and Japan Post 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 Japan Post Holdings are associated (or correlated) with AmTrust Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AmTrust Financial has no effect on the direction of Japan Post i.e., Japan Post and AmTrust Financial go up and down completely randomly.
Pair Corralation between Japan Post and AmTrust Financial
If you would invest 1,475 in AmTrust Financial Services on August 29, 2024 and sell it today you would earn a total of 10.00 from holding AmTrust Financial Services or generate 0.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 4.55% |
| Values | Daily Returns |
Japan Post Holdings vs. AmTrust Financial Services
Performance |
| Timeline |
| Japan Post Holdings |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| AmTrust Financial |
Japan Post and AmTrust Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Japan Post and AmTrust Financial
The main advantage of trading using opposite Japan Post and AmTrust Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Japan Post position performs unexpectedly, AmTrust Financial 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 AmTrust Financial will offset losses from the drop in AmTrust Financial's long position.| Japan Post vs. Huntington Bancshares Incorporated | Japan Post vs. Fifth Third Bancorp | Japan Post vs. MT Bank | Japan Post vs. Citizens Financial Group, |
| AmTrust Financial vs. AmTrust Financial Services | AmTrust Financial vs. AmTrust Financial Services | AmTrust Financial vs. AmTrust Financial Services | AmTrust Financial vs. Aspen Insurance Holdings |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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