Correlation Between Amg Southernsun and Amg Gwk
Can any of the company-specific risk be diversified away by investing in both Amg Southernsun and Amg Gwk 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 Southernsun and Amg Gwk into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amg Southernsun Equity and Amg Gwk Small, you can compare the effects of market volatilities on Amg Southernsun and Amg Gwk 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 Southernsun with a short position of Amg Gwk. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amg Southernsun and Amg Gwk.
Diversification Opportunities for Amg Southernsun and Amg Gwk
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Amg and AMG is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Amg Southernsun Equity and Amg Gwk Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amg Gwk Small and Amg Southernsun 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 Southernsun Equity are associated (or correlated) with Amg Gwk. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amg Gwk Small has no effect on the direction of Amg Southernsun i.e., Amg Southernsun and Amg Gwk go up and down completely randomly.
Pair Corralation between Amg Southernsun and Amg Gwk
Assuming the 90 days horizon Amg Southernsun is expected to generate 1.91 times less return on investment than Amg Gwk. But when comparing it to its historical volatility, Amg Southernsun Equity is 1.54 times less risky than Amg Gwk. It trades about 0.23 of its potential returns per unit of risk. Amg Gwk Small is currently generating about 0.28 of returns per unit of risk over similar time horizon. If you would invest 3,221 in Amg Gwk Small on August 26, 2024 and sell it today you would earn a total of 353.00 from holding Amg Gwk Small or generate 10.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amg Southernsun Equity vs. Amg Gwk Small
Performance |
| Timeline |
| Amg Southernsun Equity |
| Amg Gwk Small |
Amg Southernsun and Amg Gwk Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amg Southernsun and Amg Gwk
The main advantage of trading using opposite Amg Southernsun and Amg Gwk positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amg Southernsun position performs unexpectedly, Amg Gwk 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 Gwk will offset losses from the drop in Amg Gwk's long position.| Amg Southernsun vs. Amg Southernsun Small | Amg Southernsun vs. Cambiar International Equity | Amg Southernsun vs. Astoncrosswind Small Cap | Amg Southernsun vs. Hodges Small Cap |
| Amg Gwk vs. American Beacon Bridgeway | Amg Gwk vs. John Hancock Disciplined | Amg Gwk vs. Large Cap Fund | Amg Gwk vs. Baird E Plus |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
Other Complementary Tools
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated |