Correlation Between Amogreentech and SAMG Entertainment

Can any of the company-specific risk be diversified away by investing in both Amogreentech and SAMG Entertainment 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 Amogreentech and SAMG Entertainment into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Amogreentech Co and SAMG Entertainment Co, you can compare the effects of market volatilities on Amogreentech and SAMG Entertainment 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 Amogreentech with a short position of SAMG Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amogreentech and SAMG Entertainment.

Diversification Opportunities for Amogreentech and SAMG Entertainment

0.25

Correlation Coefficient

Amogreentech  SAMG Entertainment

Modest diversification

The 3 months correlation between Amogreentech and SAMG is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Amogreentech Co and SAMG Entertainment Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SAMG Entertainment and Amogreentech 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 Amogreentech Co are associated (or correlated) with SAMG Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SAMG Entertainment has no effect on the direction of Amogreentech i.e., Amogreentech and SAMG Entertainment go up and down completely randomly.

Pair Corralation between Amogreentech and SAMG Entertainment

Assuming the 90 days trading horizon Amogreentech is expected to generate 18.58 times less return on investment than SAMG Entertainment. But when comparing it to its historical volatility, Amogreentech Co is 1.94 times less risky than SAMG Entertainment. It trades about 0.03 of its potential returns per unit of risk. SAMG Entertainment Co is currently generating about 0.32 of returns per unit of risk over similar time horizon. If you would invest  1,240,000  in SAMG Entertainment Co on December 26, 2024 and sell it today you would earn a total of  1,960,000  from holding SAMG Entertainment Co or generate 158.06% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Amogreentech Co  vs.  SAMG Entertainment Co

Amogreentech

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Amogreentech Co are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Amogreentech is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

SAMG Entertainment

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in SAMG Entertainment Co are ranked lower than 25 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, SAMG Entertainment sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Amogreentech and SAMG Entertainment

The main advantage of trading using opposite Amogreentech and SAMG Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amogreentech position performs unexpectedly, SAMG Entertainment 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 SAMG Entertainment will offset losses from the drop in SAMG Entertainment's long position.

The idea behind Amogreentech Co and SAMG Entertainment Co pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.