Correlation Between Ameritrans Capital and Brightsphere Investment

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

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

Diversification Opportunities for Ameritrans Capital and Brightsphere Investment

0.0

Correlation Coefficient

Ameritrans Capital  Brightsphere Investment

Pay attention - limited upside

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

Pair Corralation between Ameritrans Capital and Brightsphere Investment

If you would invest  2,342  in Brightsphere Investment Group on August 31, 2024 and sell it today you would earn a total of  779.00  from holding Brightsphere Investment Group or generate 33.26% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Ameritrans Capital Corp  vs.  Brightsphere Investment Group

Ameritrans Capital Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ameritrans Capital Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Ameritrans Capital is not utilizing all of its potentials. The newest stock price agitation, may contribute to short-term losses for the retail investors.

Brightsphere Investment

Risk-Adjusted Performance

19 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Brightsphere Investment Group are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak forward indicators, Brightsphere Investment reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Ameritrans Capital and Brightsphere Investment

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

The idea behind Ameritrans Capital Corp and Brightsphere Investment Group 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.

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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.