Correlation Between Matson Money and Aig Government
Can any of the company-specific risk be diversified away by investing in both Matson Money and Aig Government 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 Matson Money and Aig Government into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Matson Money Equity and Aig Government Money, you can compare the effects of market volatilities on Matson Money and Aig Government 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 Matson Money with a short position of Aig Government. Check out your portfolio center. Please also check ongoing floating volatility patterns of Matson Money and Aig Government.
Diversification Opportunities for Matson Money and Aig Government
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Matson and Aig is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Matson Money Equity and Aig Government Money in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aig Government Money and Matson Money 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 Matson Money Equity are associated (or correlated) with Aig Government. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aig Government Money has no effect on the direction of Matson Money i.e., Matson Money and Aig Government go up and down completely randomly.
Pair Corralation between Matson Money and Aig Government
Assuming the 90 days horizon Matson Money is expected to generate 1.73 times less return on investment than Aig Government. In addition to that, Matson Money is 4.72 times more volatile than Aig Government Money. It trades about 0.02 of its total potential returns per unit of risk. Aig Government Money is currently generating about 0.16 per unit of volatility. If you would invest 1,003 in Aig Government Money on December 2, 2024 and sell it today you would earn a total of 11.00 from holding Aig Government Money or generate 1.1% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Matson Money Equity vs. Aig Government Money
Performance |
Timeline |
Matson Money Equity |
Aig Government Money |
Matson Money and Aig Government Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Matson Money and Aig Government
The main advantage of trading using opposite Matson Money and Aig Government positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Matson Money position performs unexpectedly, Aig Government 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 Aig Government will offset losses from the drop in Aig Government's long position.Matson Money vs. Virtus Seix Government | Matson Money vs. Us Government Securities | Matson Money vs. Us Government Securities | Matson Money vs. Us Government Securities |
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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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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