Correlation Between Amundi Treasury and International Business

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

Diversification Opportunities for Amundi Treasury and International Business

-0.33
  Correlation Coefficient

Very good diversification

The 3 months correlation between Amundi and International is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Amundi Treasury Bond and International Business Machine in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on International Business and Amundi Treasury 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 Amundi Treasury Bond are associated (or correlated) with International Business. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of International Business has no effect on the direction of Amundi Treasury i.e., Amundi Treasury and International Business go up and down completely randomly.

Pair Corralation between Amundi Treasury and International Business

If you would invest  11,895  in International Business Machines on September 6, 2024 and sell it today you would earn a total of  0.00  from holding International Business Machines or generate 0.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy67.69%
ValuesDaily Returns

Amundi Treasury Bond  vs.  International Business Machine

 Performance 
       Timeline  
Amundi Treasury Bond 

Risk-Adjusted Performance

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Weak
 
Strong
Very Weak
Over the last 90 days Amundi Treasury Bond has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Amundi Treasury is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.
International Business 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days International Business Machines has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound technical and fundamental indicators, International Business is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

Amundi Treasury and International Business Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Amundi Treasury and International Business

The main advantage of trading using opposite Amundi Treasury and International Business positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amundi Treasury position performs unexpectedly, International Business 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 International Business will offset losses from the drop in International Business' long position.
The idea behind Amundi Treasury Bond and International Business Machines 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..

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