Correlation Between Amg Managers and Old Westbury
Can any of the company-specific risk be diversified away by investing in both Amg Managers and Old Westbury 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 Amg Managers and Old Westbury into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amg Managers Centersquare and Old Westbury California, you can compare the effects of market volatilities on Amg Managers and Old Westbury 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 Amg Managers with a short position of Old Westbury. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amg Managers and Old Westbury.
Diversification Opportunities for Amg Managers and Old Westbury
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Amg and Old is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Amg Managers Centersquare and Old Westbury California in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Old Westbury California and Amg Managers 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 Amg Managers Centersquare are associated (or correlated) with Old Westbury. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Old Westbury California has no effect on the direction of Amg Managers i.e., Amg Managers and Old Westbury go up and down completely randomly.
Pair Corralation between Amg Managers and Old Westbury
Assuming the 90 days horizon Amg Managers Centersquare is expected to generate 5.95 times more return on investment than Old Westbury. However, Amg Managers is 5.95 times more volatile than Old Westbury California. It trades about 0.06 of its potential returns per unit of risk. Old Westbury California is currently generating about 0.07 per unit of risk. If you would invest 1,161 in Amg Managers Centersquare on December 8, 2024 and sell it today you would earn a total of 13.00 from holding Amg Managers Centersquare or generate 1.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amg Managers Centersquare vs. Old Westbury California
Performance |
| Timeline |
| Amg Managers Centersquare |
| Old Westbury California |
Amg Managers and Old Westbury Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amg Managers and Old Westbury
The main advantage of trading using opposite Amg Managers and Old Westbury positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amg Managers position performs unexpectedly, Old Westbury 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 Old Westbury will offset losses from the drop in Old Westbury's long position.| Amg Managers vs. Blackrock Health Sciences | ||
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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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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