Correlation Between MOGU and Ameriprise Financial

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

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

Diversification Opportunities for MOGU and Ameriprise Financial

-0.14

Correlation Coefficient

MOGU  Ameriprise Financial

Good diversification

The 3 months correlation between MOGU and Ameriprise is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding MOGU Inc and Ameriprise Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ameriprise Financial and MOGU 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 MOGU Inc are associated (or correlated) with Ameriprise Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ameriprise Financial has no effect on the direction of MOGU i.e., MOGU and Ameriprise Financial go up and down completely randomly.

Pair Corralation between MOGU and Ameriprise Financial

Given the investment horizon of 90 days MOGU is expected to generate 1.04 times less return on investment than Ameriprise Financial. In addition to that, MOGU is 3.73 times more volatile than Ameriprise Financial. It trades about 0.02 of its total potential returns per unit of risk. Ameriprise Financial is currently generating about 0.08 per unit of volatility. If you would invest  32,344  in Ameriprise Financial on October 11, 2024 and sell it today you would earn a total of  21,149  from holding Ameriprise Financial or generate 65.39% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.59%
Values	Daily Returns

MOGU Inc  vs.  Ameriprise Financial

MOGU Inc

Risk-Adjusted Performance

4 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in MOGU Inc are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively abnormal technical and fundamental indicators, MOGU unveiled solid returns over the last few months and may actually be approaching a breakup point.

Ameriprise Financial

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Ameriprise Financial are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Even with relatively uncertain primary indicators, Ameriprise Financial may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with MOGU and Ameriprise Financial

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

The idea behind MOGU Inc and Ameriprise Financial 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.

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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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.