Correlation Between Amg Managers and Pnc International

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Can any of the company-specific risk be diversified away by investing in both Amg Managers and Pnc International 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 Amg Managers and Pnc International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amg Managers Centersquare and Pnc International Equity, you can compare the effects of market volatilities on Amg Managers and Pnc International 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 Amg Managers with a short position of Pnc International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amg Managers and Pnc International.

Diversification Opportunities for Amg Managers and Pnc International

0.75
  Correlation Coefficient

Poor diversification

The 3 months correlation between Amg and Pnc is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Amg Managers Centersquare and Pnc International Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pnc International Equity and Amg Managers 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 Amg Managers Centersquare are associated (or correlated) with Pnc International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pnc International Equity has no effect on the direction of Amg Managers i.e., Amg Managers and Pnc International go up and down completely randomly.

Pair Corralation between Amg Managers and Pnc International

Assuming the 90 days horizon Amg Managers Centersquare is expected to generate 0.42 times more return on investment than Pnc International. However, Amg Managers Centersquare is 2.37 times less risky than Pnc International. It trades about -0.31 of its potential returns per unit of risk. Pnc International Equity is currently generating about -0.31 per unit of risk. If you would invest  1,215  in Amg Managers Centersquare on October 5, 2024 and sell it today you would lose (87.00) from holding Amg Managers Centersquare or give up 7.16% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy95.24%
ValuesDaily Returns

Amg Managers Centersquare  vs.  Pnc International Equity

 Performance 
       Timeline  
Amg Managers Centersquare 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Amg Managers Centersquare has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Amg Managers is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.
Pnc International Equity 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Pnc International Equity has generated negative risk-adjusted returns adding no value to fund investors. In spite of weak performance in the last few months, the Fund's basic indicators remain fairly strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for the fund investors.

Amg Managers and Pnc International Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Amg Managers and Pnc International

The main advantage of trading using opposite Amg Managers and Pnc International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amg Managers position performs unexpectedly, Pnc International 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 Pnc International will offset losses from the drop in Pnc International's long position.
The idea behind Amg Managers Centersquare and Pnc International Equity 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.

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