Correlation Between Phibro Animal and American Eagle
Can any of the company-specific risk be diversified away by investing in both Phibro Animal and American Eagle 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 Phibro Animal and American Eagle into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Phibro Animal Health and American Eagle Outfitters, you can compare the effects of market volatilities on Phibro Animal and American Eagle 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 Phibro Animal with a short position of American Eagle. Check out your portfolio center. Please also check ongoing floating volatility patterns of Phibro Animal and American Eagle.
Diversification Opportunities for Phibro Animal and American Eagle
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Phibro and American is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Phibro Animal Health and American Eagle Outfitters in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Eagle Outfitters and Phibro Animal 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 Phibro Animal Health are associated (or correlated) with American Eagle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Eagle Outfitters has no effect on the direction of Phibro Animal i.e., Phibro Animal and American Eagle go up and down completely randomly.
Pair Corralation between Phibro Animal and American Eagle
Assuming the 90 days horizon Phibro Animal Health is expected to under-perform the American Eagle. In addition to that, Phibro Animal is 1.04 times more volatile than American Eagle Outfitters. It trades about -0.07 of its total potential returns per unit of risk. American Eagle Outfitters is currently generating about -0.05 per unit of volatility. If you would invest 1,617 in American Eagle Outfitters on November 5, 2024 and sell it today you would lose (77.00) from holding American Eagle Outfitters or give up 4.76% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Phibro Animal Health vs. American Eagle Outfitters
Performance |
| Timeline |
| Phibro Animal Health |
| American Eagle Outfitters |
Phibro Animal and American Eagle Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Phibro Animal and American Eagle
The main advantage of trading using opposite Phibro Animal and American Eagle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Phibro Animal position performs unexpectedly, American Eagle 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 Eagle will offset losses from the drop in American Eagle's long position.| Phibro Animal vs. STEEL DYNAMICS | Phibro Animal vs. Mount Gibson Iron | Phibro Animal vs. TOMBADOR IRON LTD | Phibro Animal vs. Siamgas And Petrochemicals |
| American Eagle vs. Corsair Gaming | American Eagle vs. NORWEGIAN AIR SHUT | American Eagle vs. SEALED AIR | American Eagle vs. Fair Isaac Corp |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
Other Complementary Tools
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| 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 | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk |