Correlation Between Ashmore Emerging and Amg Managers
Can any of the company-specific risk be diversified away by investing in both Ashmore Emerging and Amg Managers 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 Ashmore Emerging and Amg Managers into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ashmore Emerging Markets and Amg Managers Brandywine, you can compare the effects of market volatilities on Ashmore Emerging and Amg Managers 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 Ashmore Emerging with a short position of Amg Managers. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ashmore Emerging and Amg Managers.
Diversification Opportunities for Ashmore Emerging and Amg Managers
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Ashmore and Amg is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Ashmore Emerging Markets and Amg Managers Brandywine in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amg Managers Brandywine and Ashmore Emerging 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 Ashmore Emerging Markets are associated (or correlated) with Amg Managers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amg Managers Brandywine has no effect on the direction of Ashmore Emerging i.e., Ashmore Emerging and Amg Managers go up and down completely randomly.
Pair Corralation between Ashmore Emerging and Amg Managers
Assuming the 90 days horizon Ashmore Emerging is expected to generate 3.22 times less return on investment than Amg Managers. But when comparing it to its historical volatility, Ashmore Emerging Markets is 2.88 times less risky than Amg Managers. It trades about 0.15 of its potential returns per unit of risk. Amg Managers Brandywine is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 4,004 in Amg Managers Brandywine on September 18, 2024 and sell it today you would earn a total of 67.00 from holding Amg Managers Brandywine or generate 1.67% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Ashmore Emerging Markets vs. Amg Managers Brandywine
Performance |
Timeline |
Ashmore Emerging Markets |
Amg Managers Brandywine |
Ashmore Emerging and Amg Managers Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Ashmore Emerging and Amg Managers
The main advantage of trading using opposite Ashmore Emerging and Amg Managers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ashmore Emerging position performs unexpectedly, Amg Managers 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 Amg Managers will offset losses from the drop in Amg Managers' long position.Ashmore Emerging vs. Ashmore Emerging Markets | Ashmore Emerging vs. Ashmore Emerging Markets | Ashmore Emerging vs. Ashmore Emerging Markets | Ashmore Emerging vs. Ashmore Emerging Markets |
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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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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