Correlation Between Pintec Technology and Ameriprise Financial

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

Diversification Opportunities for Pintec Technology and Ameriprise Financial

PintecAmeripriseDiversified AwayPintecAmeripriseDiversified Away100%
-0.33
  Correlation Coefficient

Very good diversification

The 3 months correlation between Pintec and Ameriprise is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Pintec Technology Holdings and Ameriprise Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ameriprise Financial and Pintec Technology 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 Pintec Technology Holdings are associated (or correlated) with Ameriprise Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ameriprise Financial has no effect on the direction of Pintec Technology i.e., Pintec Technology and Ameriprise Financial go up and down completely randomly.

Pair Corralation between Pintec Technology and Ameriprise Financial

Allowing for the 90-day total investment horizon Pintec Technology Holdings is expected to under-perform the Ameriprise Financial. In addition to that, Pintec Technology is 2.07 times more volatile than Ameriprise Financial. It trades about -0.02 of its total potential returns per unit of risk. Ameriprise Financial is currently generating about 0.12 per unit of volatility. If you would invest  42,328  in Ameriprise Financial on September 29, 2024 and sell it today you would earn a total of  11,267  from holding Ameriprise Financial or generate 26.62% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Pintec Technology Holdings  vs.  Ameriprise Financial

 Performance 
JavaScript chart by amCharts 3.21.15OctNovDec -1001020
JavaScript chart by amCharts 3.21.15PT AMP
       Timeline  
Pintec Technology 

Risk-Adjusted Performance

1 of 100

 
Weak
 
Strong
Weak
Compared to the overall equity markets, risk-adjusted returns on investments in Pintec Technology Holdings are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively abnormal basic indicators, Pintec Technology may actually be approaching a critical reversion point that can send shares even higher in January 2025.
JavaScript chart by amCharts 3.21.15NovDecDec0.80.850.90.9511.05
Ameriprise Financial 

Risk-Adjusted Performance

10 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Ameriprise Financial are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Even with relatively uncertain primary indicators, Ameriprise Financial reported solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15NovDecDec480500520540560580

Pintec Technology and Ameriprise Financial Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-7.21-5.4-3.59-1.780.01.73.475.236.998.75 0.020.040.060.080.100.120.14
JavaScript chart by amCharts 3.21.15PT AMP
       Returns  

Pair Trading with Pintec Technology and Ameriprise Financial

The main advantage of trading using opposite Pintec Technology and Ameriprise Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pintec Technology position performs unexpectedly, Ameriprise Financial 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 Ameriprise Financial will offset losses from the drop in Ameriprise Financial's long position.
The idea behind Pintec Technology Holdings and Ameriprise Financial 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.

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