Correlation Between Ameriprise Financial and SPORTING

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

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

Diversification Opportunities for Ameriprise Financial and SPORTING

-0.42

Correlation Coefficient

Ameriprise Financial  SPORTING

Very good diversification

The 3 months correlation between Ameriprise and SPORTING is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Ameriprise Financial and SPORTING in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPORTING and Ameriprise Financial 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 Ameriprise Financial are associated (or correlated) with SPORTING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPORTING has no effect on the direction of Ameriprise Financial i.e., Ameriprise Financial and SPORTING go up and down completely randomly.

Pair Corralation between Ameriprise Financial and SPORTING

Assuming the 90 days horizon Ameriprise Financial is expected to under-perform the SPORTING. But the stock apears to be less risky and, when comparing its historical volatility, Ameriprise Financial is 2.03 times less risky than SPORTING. The stock trades about -0.1 of its potential returns per unit of risk. The SPORTING is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest  102.00  in SPORTING on December 23, 2024 and sell it today you would lose (6.00) from holding SPORTING or give up 5.88% of portfolio value over 90 days.

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

Ameriprise Financial  vs.  SPORTING

Ameriprise Financial

Risk-Adjusted Performance

Very Weak

Over the last 90 days Ameriprise Financial has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

SPORTING

Risk-Adjusted Performance

Very Weak

Over the last 90 days SPORTING has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable technical and fundamental indicators, SPORTING is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Ameriprise Financial and SPORTING

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

The idea behind Ameriprise Financial and SPORTING 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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.