Correlation Between Amer Sports, and VOXX International
Can any of the company-specific risk be diversified away by investing in both Amer Sports, and VOXX International 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 VOXX International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amer Sports, and VOXX International, you can compare the effects of market volatilities on Amer Sports, and VOXX International 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 VOXX International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amer Sports, and VOXX International.
Diversification Opportunities for Amer Sports, and VOXX International
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Amer and VOXX is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Amer Sports, and VOXX International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VOXX International 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 VOXX International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VOXX International has no effect on the direction of Amer Sports, i.e., Amer Sports, and VOXX International go up and down completely randomly.
Pair Corralation between Amer Sports, and VOXX International
Allowing for the 90-day total investment horizon Amer Sports, is expected to generate 0.64 times more return on investment than VOXX International. However, Amer Sports, is 1.56 times less risky than VOXX International. It trades about 0.27 of its potential returns per unit of risk. VOXX International is currently generating about -0.05 per unit of risk. If you would invest 2,551 in Amer Sports, on September 24, 2024 and sell it today you would earn a total of 305.00 from holding Amer Sports, or generate 11.96% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Amer Sports, vs. VOXX International
Performance |
Timeline |
Amer Sports, |
VOXX International |
Amer Sports, and VOXX International Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Amer Sports, and VOXX International
The main advantage of trading using opposite Amer Sports, and VOXX International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amer Sports, position performs unexpectedly, VOXX International 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 VOXX International will offset losses from the drop in VOXX International's long position.Amer Sports, vs. Westrock Coffee | Amer Sports, vs. Vita Coco | Amer Sports, vs. Forsys Metals Corp | Amer Sports, vs. Highway Holdings Limited |
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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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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