Correlation Between AMREP and SUMIBK

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

By analyzing existing cross correlation between AMREP and SUMIBK 305 14 JAN 42, you can compare the effects of market volatilities on AMREP and SUMIBK 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 AMREP with a short position of SUMIBK. Check out your portfolio center. Please also check ongoing floating volatility patterns of AMREP and SUMIBK.

Diversification Opportunities for AMREP and SUMIBK

0.39

Correlation Coefficient

AMREP  SUMIBK

Weak diversification

The 3 months correlation between AMREP and SUMIBK is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding AMREP and SUMIBK 305 14 JAN 42 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SUMIBK 305 14 and AMREP 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 AMREP are associated (or correlated) with SUMIBK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SUMIBK 305 14 has no effect on the direction of AMREP i.e., AMREP and SUMIBK go up and down completely randomly.

Pair Corralation between AMREP and SUMIBK

Considering the 90-day investment horizon AMREP is expected to generate 3.51 times more return on investment than SUMIBK. However, AMREP is 3.51 times more volatile than SUMIBK 305 14 JAN 42. It trades about 0.08 of its potential returns per unit of risk. SUMIBK 305 14 JAN 42 is currently generating about 0.15 per unit of risk. If you would invest  3,397  in AMREP on September 14, 2024 and sell it today you would earn a total of  173.00  from holding AMREP or generate 5.09% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	38.1%
Values	Daily Returns

AMREP  vs.  SUMIBK 305 14 JAN 42

AMREP

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in AMREP are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, AMREP reported solid returns over the last few months and may actually be approaching a breakup point.

SUMIBK 305 14

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SUMIBK 305 14 JAN 42 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Bond's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for SUMIBK 305 14 JAN 42 investors.

Pair Trading with AMREP and SUMIBK

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

The idea behind AMREP and SUMIBK 305 14 JAN 42 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 Commodity Directory module to find actively traded commodities issued by global exchanges.