Correlation Between American Express and Belong Acquisition
Can any of the company-specific risk be diversified away by investing in both American Express and Belong Acquisition 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 American Express and Belong Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Express and Belong Acquisition Corp, you can compare the effects of market volatilities on American Express and Belong Acquisition 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 American Express with a short position of Belong Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Express and Belong Acquisition.
Diversification Opportunities for American Express and Belong Acquisition
-0.83 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between American and Belong is -0.83. Overlapping area represents the amount of risk that can be diversified away by holding American Express and Belong Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Belong Acquisition Corp and American Express 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 American Express are associated (or correlated) with Belong Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Belong Acquisition Corp has no effect on the direction of American Express i.e., American Express and Belong Acquisition go up and down completely randomly.
Pair Corralation between American Express and Belong Acquisition
If you would invest 26,041 in American Express on September 16, 2024 and sell it today you would earn a total of 4,173 from holding American Express or generate 16.02% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Significant |
Accuracy | 1.54% |
Values | Daily Returns |
American Express vs. Belong Acquisition Corp
Performance |
Timeline |
American Express |
Belong Acquisition Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
American Express and Belong Acquisition Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with American Express and Belong Acquisition
The main advantage of trading using opposite American Express and Belong Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Express position performs unexpectedly, Belong Acquisition 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 Belong Acquisition will offset losses from the drop in Belong Acquisition's long position.American Express vs. Visa Class A | American Express vs. PayPal Holdings | American Express vs. Upstart Holdings | American Express vs. Mastercard |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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