Correlation Between Amg Frontier and Amg Frontier

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

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

Diversification Opportunities for Amg Frontier and Amg Frontier

1.0

Correlation Coefficient

Amg Frontier  Amg Frontier

No risk reduction

The 3 months correlation between Amg and Amg is 1.0. Overlapping area represents the amount of risk that can be diversified away by holding Amg Frontier Small and Amg Frontier Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amg Frontier Small and Amg Frontier 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 Frontier Small are associated (or correlated) with Amg Frontier. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amg Frontier Small has no effect on the direction of Amg Frontier i.e., Amg Frontier and Amg Frontier go up and down completely randomly.

Pair Corralation between Amg Frontier and Amg Frontier

Assuming the 90 days horizon Amg Frontier Small is expected to under-perform the Amg Frontier. But the mutual fund apears to be less risky and, when comparing its historical volatility, Amg Frontier Small is 1.0 times less risky than Amg Frontier. The mutual fund trades about -0.11 of its potential returns per unit of risk. The Amg Frontier Small is currently generating about -0.11 of returns per unit of risk over similar time horizon. If you would invest  944.00  in Amg Frontier Small on December 18, 2024 and sell it today you would lose (98.00) from holding Amg Frontier Small or give up 10.38% of portfolio value over 90 days.

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

Amg Frontier Small  vs.  Amg Frontier Small

Amg Frontier Small

Risk-Adjusted Performance

Very Weak

Over the last 90 days Amg Frontier Small has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Amg Frontier Small

Risk-Adjusted Performance

Very Weak

Over the last 90 days Amg Frontier Small has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Pair Trading with Amg Frontier and Amg Frontier

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

The idea behind Amg Frontier Small and Amg Frontier Small 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.