Correlation Between Amer Sports, and Gold

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

By analyzing existing cross correlation between Amer Sports, and Gold And Gemstone, you can compare the effects of market volatilities on Amer Sports, and Gold 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 Amer Sports, with a short position of Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amer Sports, and Gold.

Diversification Opportunities for Amer Sports, and Gold

-0.59

Correlation Coefficient

Amer Sports,  Gold

Excellent diversification

The 3 months correlation between Amer and Gold is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Amer Sports, and Gold And Gemstone in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gold And Gemstone and Amer Sports, 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 Amer Sports, are associated (or correlated) with Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gold And Gemstone has no effect on the direction of Amer Sports, i.e., Amer Sports, and Gold go up and down completely randomly.

Pair Corralation between Amer Sports, and Gold

Allowing for the 90-day total investment horizon Amer Sports, is expected to generate 3.28 times less return on investment than Gold. But when comparing it to its historical volatility, Amer Sports, is 8.88 times less risky than Gold. It trades about 0.34 of its potential returns per unit of risk. Gold And Gemstone is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest  0.05  in Gold And Gemstone on October 15, 2024 and sell it today you would earn a total of  0.01  from holding Gold And Gemstone or generate 20.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Amer Sports,  vs.  Gold And Gemstone

Amer Sports,

Risk-Adjusted Performance

24 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Amer Sports, are ranked lower than 24 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Amer Sports, unveiled solid returns over the last few months and may actually be approaching a breakup point.

Gold And Gemstone

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Gold And Gemstone are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of very unsteady basic indicators, Gold displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Amer Sports, and Gold

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

The idea behind Amer Sports, and Gold And Gemstone 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.