Correlation Between 00108WAF7 and FMEGR
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By analyzing existing cross correlation between AEP TEX INC and FMEGR 1875 01 DEC 26, you can compare the effects of market volatilities on 00108WAF7 and FMEGR 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 00108WAF7 with a short position of FMEGR. Check out your portfolio center. Please also check ongoing floating volatility patterns of 00108WAF7 and FMEGR.
Diversification Opportunities for 00108WAF7 and FMEGR
Good diversification
The 3 months correlation between 00108WAF7 and FMEGR is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding AEP TEX INC and FMEGR 1875 01 DEC 26 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FMEGR 1875 01 and 00108WAF7 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 AEP TEX INC are associated (or correlated) with FMEGR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FMEGR 1875 01 has no effect on the direction of 00108WAF7 i.e., 00108WAF7 and FMEGR go up and down completely randomly.
Pair Corralation between 00108WAF7 and FMEGR
Assuming the 90 days trading horizon AEP TEX INC is expected to generate 145.0 times more return on investment than FMEGR. However, 00108WAF7 is 145.0 times more volatile than FMEGR 1875 01 DEC 26. It trades about 0.13 of its potential returns per unit of risk. FMEGR 1875 01 DEC 26 is currently generating about 0.03 per unit of risk. If you would invest 7,882 in AEP TEX INC on September 3, 2024 and sell it today you would earn a total of 339.00 from holding AEP TEX INC or generate 4.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 63.46% |
| Values | Daily Returns |
AEP TEX INC vs. FMEGR 1875 01 DEC 26
Performance |
| Timeline |
| AEP TEX INC |
| FMEGR 1875 01 |
00108WAF7 and FMEGR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 00108WAF7 and FMEGR
The main advantage of trading using opposite 00108WAF7 and FMEGR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 00108WAF7 position performs unexpectedly, FMEGR 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 FMEGR will offset losses from the drop in FMEGR's long position.| 00108WAF7 vs. Universal Music Group | 00108WAF7 vs. Pool Corporation | 00108WAF7 vs. Under Armour C | 00108WAF7 vs. Figs Inc |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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