Correlation Between Summit Environmental and Amgen
Can any of the company-specific risk be diversified away by investing in both Summit Environmental and Amgen 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 Summit Environmental and Amgen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Summit Environmental and Amgen Inc, you can compare the effects of market volatilities on Summit Environmental and Amgen 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 Summit Environmental with a short position of Amgen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Summit Environmental and Amgen.
Diversification Opportunities for Summit Environmental and Amgen
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Summit and Amgen is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Summit Environmental and Amgen Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amgen Inc and Summit Environmental 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 Summit Environmental are associated (or correlated) with Amgen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amgen Inc has no effect on the direction of Summit Environmental i.e., Summit Environmental and Amgen go up and down completely randomly.
Pair Corralation between Summit Environmental and Amgen
If you would invest 27,587 in Amgen Inc on December 2, 2024 and sell it today you would earn a total of 3,219 from holding Amgen Inc or generate 11.67% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Summit Environmental vs. Amgen Inc
Performance |
Timeline |
Summit Environmental |
Amgen Inc |
Summit Environmental and Amgen Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Summit Environmental and Amgen
The main advantage of trading using opposite Summit Environmental and Amgen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Summit Environmental position performs unexpectedly, Amgen 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 Amgen will offset losses from the drop in Amgen's long position.Summit Environmental vs. The Coca Cola | Summit Environmental vs. LAir Liquide SA | Summit Environmental vs. Diageo PLC ADR | Summit Environmental vs. Wheels Up Experience |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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