Correlation Between SMX Public and AMREP
Can any of the company-specific risk be diversified away by investing in both SMX Public and AMREP 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 SMX Public and AMREP into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SMX Public Limited and AMREP, you can compare the effects of market volatilities on SMX Public and AMREP 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 SMX Public with a short position of AMREP. Check out your portfolio center. Please also check ongoing floating volatility patterns of SMX Public and AMREP.
Diversification Opportunities for SMX Public and AMREP
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between SMX and AMREP is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding SMX Public Limited and AMREP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AMREP and SMX Public 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 SMX Public Limited are associated (or correlated) with AMREP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AMREP has no effect on the direction of SMX Public i.e., SMX Public and AMREP go up and down completely randomly.
Pair Corralation between SMX Public and AMREP
Considering the 90-day investment horizon SMX Public Limited is expected to under-perform the AMREP. In addition to that, SMX Public is 5.54 times more volatile than AMREP. It trades about -0.08 of its total potential returns per unit of risk. AMREP is currently generating about 0.21 per unit of volatility. If you would invest 2,210 in AMREP on September 2, 2024 and sell it today you would earn a total of 1,394 from holding AMREP or generate 63.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SMX Public Limited vs. AMREP
Performance |
| Timeline |
| SMX Public Limited |
| AMREP |
SMX Public and AMREP Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SMX Public and AMREP
The main advantage of trading using opposite SMX Public and AMREP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SMX Public position performs unexpectedly, AMREP 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 AMREP will offset losses from the drop in AMREP's long position.| SMX Public vs. Team Inc | SMX Public vs. Lichen China Limited | SMX Public vs. System1 | SMX Public vs. Eastman Kodak Co |
| AMREP vs. Landsea Homes Corp | AMREP vs. Forestar Group | AMREP vs. Five Point Holdings | AMREP vs. American Realty Investors |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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