Correlation Between Liberty Broadband and AMETEK,

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

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

Diversification Opportunities for Liberty Broadband and AMETEK,

0.19

Correlation Coefficient

Liberty Broadband  AMETEK,

Average diversification

The 3 months correlation between Liberty and AMETEK, is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Liberty Broadband and AMETEK, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AMETEK, and Liberty Broadband 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 Liberty Broadband are associated (or correlated) with AMETEK,. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AMETEK, has no effect on the direction of Liberty Broadband i.e., Liberty Broadband and AMETEK, go up and down completely randomly.

Pair Corralation between Liberty Broadband and AMETEK,

Assuming the 90 days trading horizon Liberty Broadband is expected to generate 4.62 times less return on investment than AMETEK,. In addition to that, Liberty Broadband is 1.38 times more volatile than AMETEK,. It trades about 0.02 of its total potential returns per unit of risk. AMETEK, is currently generating about 0.12 per unit of volatility. If you would invest  4,016  in AMETEK, on October 24, 2024 and sell it today you would earn a total of  545.00  from holding AMETEK, or generate 13.57% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Liberty Broadband  vs.  AMETEK,

Liberty Broadband

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Liberty Broadband are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Liberty Broadband is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

AMETEK,

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in AMETEK, are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak primary indicators, AMETEK, sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Liberty Broadband and AMETEK,

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

The idea behind Liberty Broadband and AMETEK, 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.

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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.