Correlation Between After You and Ama Marine

Can any of the company-specific risk be diversified away by investing in both After You and Ama Marine 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 After You and Ama Marine into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between After You Public and Ama Marine Public, you can compare the effects of market volatilities on After You and Ama Marine 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 After You with a short position of Ama Marine. Check out your portfolio center. Please also check ongoing floating volatility patterns of After You and Ama Marine.

Diversification Opportunities for After You and Ama Marine

-0.85

Correlation Coefficient

After You  Ama Marine

Pay attention - limited upside

The 3 months correlation between After and Ama is -0.85. Overlapping area represents the amount of risk that can be diversified away by holding After You Public and Ama Marine Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ama Marine Public and After You 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 After You Public are associated (or correlated) with Ama Marine. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ama Marine Public has no effect on the direction of After You i.e., After You and Ama Marine go up and down completely randomly.

Pair Corralation between After You and Ama Marine

Assuming the 90 days horizon After You Public is expected to generate 1.58 times more return on investment than Ama Marine. However, After You is 1.58 times more volatile than Ama Marine Public. It trades about 0.13 of its potential returns per unit of risk. Ama Marine Public is currently generating about -0.12 per unit of risk. If you would invest  970.00  in After You Public on September 14, 2024 and sell it today you would earn a total of  130.00  from holding After You Public or generate 13.4% return on investment over 90 days.

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

After You Public  vs.  Ama Marine Public

After You Public

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in After You Public are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite quite weak fundamental drivers, After You disclosed solid returns over the last few months and may actually be approaching a breakup point.

Ama Marine Public

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ama Marine Public has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain persistent and the latest mess on Wall Street may also be a sign of long-standing gains for the company institutional investors.

Pair Trading with After You and Ama Marine

The main advantage of trading using opposite After You and Ama Marine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if After You position performs unexpectedly, Ama Marine 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 Ama Marine will offset losses from the drop in Ama Marine's long position.

The idea behind After You Public and Ama Marine Public 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.