Correlation Between American Express and SGH Old
Can any of the company-specific risk be diversified away by investing in both American Express and SGH Old 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 Express and SGH Old into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Express and SGH Old, you can compare the effects of market volatilities on American Express and SGH Old 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 Express with a short position of SGH Old. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Express and SGH Old.
Diversification Opportunities for American Express and SGH Old
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between American and SGH is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding American Express and SGH Old in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SGH Old and American Express 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 Express are associated (or correlated) with SGH Old. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SGH Old has no effect on the direction of American Express i.e., American Express and SGH Old go up and down completely randomly.
Pair Corralation between American Express and SGH Old
If you would invest 30,155 in American Express on December 1, 2024 and sell it today you would lose (59.00) from holding American Express or give up 0.2% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 0.0% |
Values | Daily Returns |
American Express vs. SGH Old
Performance |
Timeline |
American Express |
SGH Old |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
American Express and SGH Old Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with American Express and SGH Old
The main advantage of trading using opposite American Express and SGH Old positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Express position performs unexpectedly, SGH Old 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 SGH Old will offset losses from the drop in SGH Old's long position.American Express vs. Visa Class A | American Express vs. PayPal Holdings | American Express vs. Capital One Financial | American Express vs. Upstart Holdings |
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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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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