Correlation Between Pampa Energia and American Express
Can any of the company-specific risk be diversified away by investing in both Pampa Energia and American Express 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 Pampa Energia and American Express into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pampa Energia SA and American Express Co, you can compare the effects of market volatilities on Pampa Energia and American Express 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 Pampa Energia with a short position of American Express. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pampa Energia and American Express.
Diversification Opportunities for Pampa Energia and American Express
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Pampa and American is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Pampa Energia SA and American Express Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Express and Pampa Energia 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 Pampa Energia SA are associated (or correlated) with American Express. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Express has no effect on the direction of Pampa Energia i.e., Pampa Energia and American Express go up and down completely randomly.
Pair Corralation between Pampa Energia and American Express
Assuming the 90 days trading horizon Pampa Energia SA is expected to generate 0.66 times more return on investment than American Express. However, Pampa Energia SA is 1.51 times less risky than American Express. It trades about 0.64 of its potential returns per unit of risk. American Express Co is currently generating about 0.19 per unit of risk. If you would invest 312,000 in Pampa Energia SA on August 28, 2024 and sell it today you would earn a total of 59,000 from holding Pampa Energia SA or generate 18.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pampa Energia SA vs. American Express Co
Performance |
| Timeline |
| Pampa Energia SA |
| American Express |
Pampa Energia and American Express Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pampa Energia and American Express
The main advantage of trading using opposite Pampa Energia and American Express positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pampa Energia position performs unexpectedly, American Express 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 American Express will offset losses from the drop in American Express' long position.| Pampa Energia vs. United States Steel | Pampa Energia vs. Pfizer Inc | Pampa Energia vs. Distribuidora de Gas | Pampa Energia vs. IRSA Propiedades Comerciales |
| American Express vs. Pampa Energia SA | American Express vs. United States Steel | American Express vs. Pfizer Inc | American Express vs. Distribuidora de Gas |
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 Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
Other Complementary Tools
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments |