Correlation Between Ameriprise Financial and AEON STORES

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

Diversification Opportunities for Ameriprise Financial and AEON STORES

AmeripriseAEONDiversified AwayAmeripriseAEONDiversified Away100%
-0.06
  Correlation Coefficient

Good diversification

The 3 months correlation between Ameriprise and AEON is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Ameriprise Financial and AEON STORES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AEON STORES and Ameriprise Financial 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 Ameriprise Financial are associated (or correlated) with AEON STORES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AEON STORES has no effect on the direction of Ameriprise Financial i.e., Ameriprise Financial and AEON STORES go up and down completely randomly.

Pair Corralation between Ameriprise Financial and AEON STORES

Assuming the 90 days horizon Ameriprise Financial is expected to generate 0.5 times more return on investment than AEON STORES. However, Ameriprise Financial is 2.01 times less risky than AEON STORES. It trades about 0.08 of its potential returns per unit of risk. AEON STORES is currently generating about -0.01 per unit of risk. If you would invest  28,897  in Ameriprise Financial on September 29, 2024 and sell it today you would earn a total of  22,463  from holding Ameriprise Financial or generate 77.73% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Ameriprise Financial  vs.  AEON STORES

 Performance 
JavaScript chart by amCharts 3.21.15OctNovDec 51015202530
JavaScript chart by amCharts 3.21.15A4S AVK1
       Timeline  
Ameriprise Financial 

Risk-Adjusted Performance

13 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Ameriprise Financial are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Ameriprise Financial reported solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15OctNovDecNovDec420440460480500520540560
AEON STORES 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days AEON STORES has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest fragile performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.
JavaScript chart by amCharts 3.21.15OctNovDecNovDec0.05650.0570.05750.0580.05850.0590.05950.060.0605

Ameriprise Financial and AEON STORES Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-5.99-4.49-2.98-1.480.01.593.234.886.528.17 0.10.20.30.40.50.6
JavaScript chart by amCharts 3.21.15A4S AVK1
       Returns  

Pair Trading with Ameriprise Financial and AEON STORES

The main advantage of trading using opposite Ameriprise Financial and AEON STORES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ameriprise Financial position performs unexpectedly, AEON STORES 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 AEON STORES will offset losses from the drop in AEON STORES's long position.
The idea behind Ameriprise Financial and AEON STORES 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.

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