Correlation Between Blue Owl and Ameriprise Financial

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

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

Diversification Opportunities for Blue Owl and Ameriprise Financial

0.08

Correlation Coefficient

Blue Owl  Ameriprise Financial

Significant diversification

The 3 months correlation between Blue and Ameriprise is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Blue Owl Capital and Ameriprise Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ameriprise Financial and Blue Owl 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 Blue Owl Capital 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 Blue Owl i.e., Blue Owl and Ameriprise Financial go up and down completely randomly.

Pair Corralation between Blue Owl and Ameriprise Financial

Given the investment horizon of 90 days Blue Owl Capital is expected to under-perform the Ameriprise Financial. But the stock apears to be less risky and, when comparing its historical volatility, Blue Owl Capital is 1.43 times less risky than Ameriprise Financial. The stock trades about 0.0 of its potential returns per unit of risk. The Ameriprise Financial is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest  53,423  in Ameriprise Financial on October 23, 2024 and sell it today you would earn a total of  2,451  from holding Ameriprise Financial or generate 4.59% return on investment over 90 days.

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

Blue Owl Capital  vs.  Ameriprise Financial

Blue Owl Capital

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Blue Owl Capital are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound fundamental indicators, Blue Owl is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

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 Blue Owl and Ameriprise Financial

The main advantage of trading using opposite Blue Owl and Ameriprise Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blue Owl 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 Blue Owl Capital 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.

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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.