Correlation Between Amg Southernsun and Aamg Funds

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

By analyzing existing cross correlation between Amg Southernsun Equity and Aamg Funds Iv, you can compare the effects of market volatilities on Amg Southernsun and Aamg Funds 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 Amg Southernsun with a short position of Aamg Funds. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amg Southernsun and Aamg Funds.

Diversification Opportunities for Amg Southernsun and Aamg Funds

0.5

Correlation Coefficient

Amg Southernsun  Aamg Funds

Very weak diversification

The 3 months correlation between Amg and Aamg is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Amg Southernsun Equity and Aamg Funds Iv in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aamg Funds Iv and Amg Southernsun 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 Amg Southernsun Equity are associated (or correlated) with Aamg Funds. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aamg Funds Iv has no effect on the direction of Amg Southernsun i.e., Amg Southernsun and Aamg Funds go up and down completely randomly.

Pair Corralation between Amg Southernsun and Aamg Funds

Assuming the 90 days horizon Amg Southernsun Equity is expected to under-perform the Aamg Funds. In addition to that, Amg Southernsun is 1.98 times more volatile than Aamg Funds Iv. It trades about -0.11 of its total potential returns per unit of risk. Aamg Funds Iv is currently generating about 0.05 per unit of volatility. If you would invest  1,814  in Aamg Funds Iv on September 20, 2024 and sell it today you would earn a total of  58.00  from holding Aamg Funds Iv or generate 3.2% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.44%
Values	Daily Returns

Amg Southernsun Equity  vs.  Aamg Funds Iv

Amg Southernsun Equity

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Amg Southernsun Equity has generated negative risk-adjusted returns adding no value to fund investors. In spite of weak performance in the last few months, the Fund's technical and fundamental indicators remain fairly strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the fund investors.

Aamg Funds Iv

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Aamg Funds Iv are ranked lower than 4 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Aamg Funds is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Amg Southernsun and Aamg Funds

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

The idea behind Amg Southernsun Equity and Aamg Funds Iv 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.