Correlation Between New Amer and Finance Of

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

By analyzing existing cross correlation between New Amer Energy and Finance of America, you can compare the effects of market volatilities on New Amer and Finance Of 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 New Amer with a short position of Finance Of. Check out your portfolio center. Please also check ongoing floating volatility patterns of New Amer and Finance Of.

Diversification Opportunities for New Amer and Finance Of

0.0

Correlation Coefficient

New Amer  Finance Of

Pay attention - limited upside

The 3 months correlation between New and Finance is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding New Amer Energy and Finance of America in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Finance of America and New Amer 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 New Amer Energy are associated (or correlated) with Finance Of. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Finance of America has no effect on the direction of New Amer i.e., New Amer and Finance Of go up and down completely randomly.

Pair Corralation between New Amer and Finance Of

If you would invest (100.00) in New Amer Energy on December 27, 2024 and sell it today you would earn a total of  100.00  from holding New Amer Energy or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

New Amer Energy  vs.  Finance of America

New Amer Energy

Risk-Adjusted Performance

Very Weak

Over the last 90 days New Amer Energy has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong fundamental indicators, New Amer is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Finance of America

Risk-Adjusted Performance

Very Weak

Over the last 90 days Finance of America has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with New Amer and Finance Of

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

The idea behind New Amer Energy and Finance of America 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.