Correlation Between Archer Daniels and Aimfinity Investment
Can any of the company-specific risk be diversified away by investing in both Archer Daniels and Aimfinity Investment 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 Archer Daniels and Aimfinity Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Archer Daniels Midland and Aimfinity Investment I, you can compare the effects of market volatilities on Archer Daniels and Aimfinity Investment 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 Archer Daniels with a short position of Aimfinity Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Archer Daniels and Aimfinity Investment.
Diversification Opportunities for Archer Daniels and Aimfinity Investment
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between Archer and Aimfinity is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Archer Daniels Midland and Aimfinity Investment I in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aimfinity Investment and Archer Daniels 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 Archer Daniels Midland are associated (or correlated) with Aimfinity Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aimfinity Investment has no effect on the direction of Archer Daniels i.e., Archer Daniels and Aimfinity Investment go up and down completely randomly.
Pair Corralation between Archer Daniels and Aimfinity Investment
Considering the 90-day investment horizon Archer Daniels Midland is expected to under-perform the Aimfinity Investment. In addition to that, Archer Daniels is 4.76 times more volatile than Aimfinity Investment I. It trades about -0.16 of its total potential returns per unit of risk. Aimfinity Investment I is currently generating about 0.22 per unit of volatility. If you would invest 1,181 in Aimfinity Investment I on December 2, 2024 and sell it today you would earn a total of 23.00 from holding Aimfinity Investment I or generate 1.95% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Archer Daniels Midland vs. Aimfinity Investment I
Performance |
Timeline |
Archer Daniels Midland |
Aimfinity Investment |
Archer Daniels and Aimfinity Investment Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Archer Daniels and Aimfinity Investment
The main advantage of trading using opposite Archer Daniels and Aimfinity Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Archer Daniels position performs unexpectedly, Aimfinity Investment 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 Aimfinity Investment will offset losses from the drop in Aimfinity Investment's long position.Archer Daniels vs. Adecoagro SA | Archer Daniels vs. Cal Maine Foods | Archer Daniels vs. Tyson Foods | Archer Daniels vs. Fresh Del Monte |
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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 Stocks Directory module to find actively traded stocks across global markets.
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