Correlation Between Amplify Energy and Ashford

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

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

Diversification Opportunities for Amplify Energy and Ashford

-0.09

Correlation Coefficient

Amplify Energy  Ashford

Good diversification

The 3 months correlation between Amplify and Ashford is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Amplify Energy Corp and Ashford in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ashford and Amplify Energy 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 Amplify Energy Corp are associated (or correlated) with Ashford. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ashford has no effect on the direction of Amplify Energy i.e., Amplify Energy and Ashford go up and down completely randomly.

Pair Corralation between Amplify Energy and Ashford

If you would invest  644.00  in Amplify Energy Corp on September 4, 2024 and sell it today you would earn a total of  18.00  from holding Amplify Energy Corp or generate 2.8% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	1.56%
Values	Daily Returns

Amplify Energy Corp  vs.  Ashford

Amplify Energy Corp

Risk-Adjusted Performance

2 of 100

Weak

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

Ashford

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ashford has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Ashford is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Amplify Energy and Ashford

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

The idea behind Amplify Energy Corp and Ashford 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.