Correlation Between Southern Copper and Ameriprise Financial
Can any of the company-specific risk be diversified away by investing in both Southern Copper and Ameriprise 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 Southern Copper and Ameriprise Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Southern Copper and Ameriprise Financial, you can compare the effects of market volatilities on Southern Copper and Ameriprise 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 Southern Copper with a short position of Ameriprise Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Southern Copper and Ameriprise Financial.
Diversification Opportunities for Southern Copper and Ameriprise Financial
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Southern and Ameriprise is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Southern Copper and Ameriprise Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ameriprise Financial and Southern Copper 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 Southern Copper are associated (or correlated) with Ameriprise Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ameriprise Financial has no effect on the direction of Southern Copper i.e., Southern Copper and Ameriprise Financial go up and down completely randomly.
Pair Corralation between Southern Copper and Ameriprise Financial
Assuming the 90 days trading horizon Southern Copper is expected to under-perform the Ameriprise Financial. But the stock apears to be less risky and, when comparing its historical volatility, Southern Copper is 3.54 times less risky than Ameriprise Financial. The stock trades about -0.2 of its potential returns per unit of risk. The Ameriprise Financial is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 928,741 in Ameriprise Financial on August 31, 2024 and sell it today you would earn a total of 229,412 from holding Ameriprise Financial or generate 24.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Southern Copper vs. Ameriprise Financial
Performance |
| Timeline |
| Southern Copper |
| Ameriprise Financial |
Southern Copper and Ameriprise Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Southern Copper and Ameriprise Financial
The main advantage of trading using opposite Southern Copper and Ameriprise Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Southern Copper position performs unexpectedly, Ameriprise 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 Ameriprise Financial will offset losses from the drop in Ameriprise Financial's long position.| Southern Copper vs. Deutsche Bank Aktiengesellschaft | Southern Copper vs. FIBRA Storage | Southern Copper vs. McEwen Mining | Southern Copper vs. Ross Stores |
| Ameriprise Financial vs. First Majestic Silver | Ameriprise Financial vs. FibraHotel | Ameriprise Financial vs. Monster Beverage Corp | Ameriprise Financial vs. Verizon Communications |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
Other Complementary Tools
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk |