Correlation Between American Equity and FG Annuities

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

By analyzing existing cross correlation between American Equity Investment and FG Annuities Life, you can compare the effects of market volatilities on American Equity and FG Annuities 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 American Equity with a short position of FG Annuities. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Equity and FG Annuities.

Diversification Opportunities for American Equity and FG Annuities

0.0

Correlation Coefficient

American Equity  FG Annuities

Pay attention - limited upside

The 3 months correlation between American and FG Annuities is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding American Equity Investment and FG Annuities Life in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FG Annuities Life and American Equity 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 American Equity Investment are associated (or correlated) with FG Annuities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FG Annuities Life has no effect on the direction of American Equity i.e., American Equity and FG Annuities go up and down completely randomly.

Pair Corralation between American Equity and FG Annuities

If you would invest (100.00) in American Equity Investment on December 30, 2024 and sell it today you would earn a total of  100.00  from holding American Equity Investment or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

American Equity Investment  vs.  FG Annuities Life

American Equity Inve

Risk-Adjusted Performance

Very Weak

Over the last 90 days American Equity Investment has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent technical and fundamental indicators, American Equity is not utilizing all of its potentials. The current stock price mess, may contribute to short-term losses for the institutional investors.

FG Annuities Life

Risk-Adjusted Performance

Very Weak

Over the last 90 days FG Annuities Life has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unfluctuating performance in the last few months, the Stock's technical and fundamental indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with American Equity and FG Annuities

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

The idea behind American Equity Investment and FG Annuities Life 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.