Correlation Between Yamaha and Amphenol
Can any of the company-specific risk be diversified away by investing in both Yamaha and Amphenol 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 Yamaha and Amphenol into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Yamaha and Amphenol, you can compare the effects of market volatilities on Yamaha and Amphenol 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 Yamaha with a short position of Amphenol. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yamaha and Amphenol.
Diversification Opportunities for Yamaha and Amphenol
Pay attention - limited upside
The 3 months correlation between Yamaha and Amphenol is -0.85. Overlapping area represents the amount of risk that can be diversified away by holding Yamaha and Amphenol in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amphenol and Yamaha 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 Yamaha are associated (or correlated) with Amphenol. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amphenol has no effect on the direction of Yamaha i.e., Yamaha and Amphenol go up and down completely randomly.
Pair Corralation between Yamaha and Amphenol
Assuming the 90 days horizon Yamaha is expected to under-perform the Amphenol. In addition to that, Yamaha is 1.29 times more volatile than Amphenol. It trades about -0.04 of its total potential returns per unit of risk. Amphenol is currently generating about 0.09 per unit of volatility. If you would invest 3,521 in Amphenol on September 23, 2024 and sell it today you would earn a total of 3,279 from holding Amphenol or generate 93.13% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Yamaha vs. Amphenol
Performance |
Timeline |
Yamaha |
Amphenol |
Yamaha and Amphenol Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Yamaha and Amphenol
The main advantage of trading using opposite Yamaha and Amphenol positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yamaha position performs unexpectedly, Amphenol 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 Amphenol will offset losses from the drop in Amphenol's long position.Yamaha vs. Magic Software Enterprises | Yamaha vs. MOVIE GAMES SA | Yamaha vs. Addus HomeCare | Yamaha vs. CPU SOFTWAREHOUSE |
Amphenol vs. Hon Hai Precision | Amphenol vs. Samsung SDI Co | Amphenol vs. Murata Manufacturing Co | Amphenol vs. Corning Incorporated |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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