Correlation Between Ameriprise Financial and SIKA AG
Can any of the company-specific risk be diversified away by investing in both Ameriprise Financial and SIKA AG 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 SIKA AG into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ameriprise Financial and SIKA AG UNSPADR, you can compare the effects of market volatilities on Ameriprise Financial and SIKA AG 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 SIKA AG. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ameriprise Financial and SIKA AG.
Diversification Opportunities for Ameriprise Financial and SIKA AG
-0.92 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Ameriprise and SIKA is -0.92. Overlapping area represents the amount of risk that can be diversified away by holding Ameriprise Financial and SIKA AG UNSPADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SIKA AG UNSPADR 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 SIKA AG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SIKA AG UNSPADR has no effect on the direction of Ameriprise Financial i.e., Ameriprise Financial and SIKA AG go up and down completely randomly.
Pair Corralation between Ameriprise Financial and SIKA AG
Assuming the 90 days horizon Ameriprise Financial is expected to generate 0.95 times more return on investment than SIKA AG. However, Ameriprise Financial is 1.05 times less risky than SIKA AG. It trades about 0.13 of its potential returns per unit of risk. SIKA AG UNSPADR is currently generating about -0.03 per unit of risk. If you would invest 33,649 in Ameriprise Financial on September 15, 2024 and sell it today you would earn a total of 18,531 from holding Ameriprise Financial or generate 55.07% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Ameriprise Financial vs. SIKA AG UNSPADR
Performance |
Timeline |
Ameriprise Financial |
SIKA AG UNSPADR |
Ameriprise Financial and SIKA AG Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Ameriprise Financial and SIKA AG
The main advantage of trading using opposite Ameriprise Financial and SIKA AG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ameriprise Financial position performs unexpectedly, SIKA AG 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 SIKA AG will offset losses from the drop in SIKA AG's long position.Ameriprise Financial vs. Ares Management Corp | ||
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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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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