Correlation Between Amg Frontier and Amg Timessquare
Can any of the company-specific risk be diversified away by investing in both Amg Frontier and Amg Timessquare 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 Frontier and Amg Timessquare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amg Frontier Small and Amg Timessquare International, you can compare the effects of market volatilities on Amg Frontier and Amg Timessquare 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 Frontier with a short position of Amg Timessquare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amg Frontier and Amg Timessquare.
Diversification Opportunities for Amg Frontier and Amg Timessquare
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Amg and Amg is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Amg Frontier Small and Amg Timessquare International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amg Timessquare Inte and Amg Frontier 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 Frontier Small are associated (or correlated) with Amg Timessquare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amg Timessquare Inte has no effect on the direction of Amg Frontier i.e., Amg Frontier and Amg Timessquare go up and down completely randomly.
Pair Corralation between Amg Frontier and Amg Timessquare
Assuming the 90 days horizon Amg Frontier Small is expected to generate 2.45 times more return on investment than Amg Timessquare. However, Amg Frontier is 2.45 times more volatile than Amg Timessquare International. It trades about 0.21 of its potential returns per unit of risk. Amg Timessquare International is currently generating about -0.15 per unit of risk. If you would invest 877.00 in Amg Frontier Small on August 25, 2024 and sell it today you would earn a total of 67.00 from holding Amg Frontier Small or generate 7.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amg Frontier Small vs. Amg Timessquare International
Performance |
| Timeline |
| Amg Frontier Small |
| Amg Timessquare Inte |
Amg Frontier and Amg Timessquare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amg Frontier and Amg Timessquare
The main advantage of trading using opposite Amg Frontier and Amg Timessquare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amg Frontier position performs unexpectedly, Amg Timessquare 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 Amg Timessquare will offset losses from the drop in Amg Timessquare's long position.| Amg Frontier vs. Columbia Small Cap | Amg Frontier vs. Baron Discovery Fund | Amg Frontier vs. Astoncrosswind Small Cap | Amg Frontier vs. Amg Frontier Small |
| Amg Timessquare vs. Hennessy Japan Fund | Amg Timessquare vs. The Jensen Portfolio | Amg Timessquare vs. Artisan International Value |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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