Correlation Between Tekla Healthcare and Amg Fq

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

By analyzing existing cross correlation between Tekla Healthcare Opportunities and Amg Fq Long Short, you can compare the effects of market volatilities on Tekla Healthcare and Amg Fq 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 Tekla Healthcare with a short position of Amg Fq. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tekla Healthcare and Amg Fq.

Diversification Opportunities for Tekla Healthcare and Amg Fq

-0.54

Correlation Coefficient

Tekla Healthcare  Amg Fq

Excellent diversification

The 3 months correlation between Tekla and Amg is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Tekla Healthcare Opportunities and Amg Fq Long Short in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amg Fq Long and Tekla Healthcare 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 Tekla Healthcare Opportunities are associated (or correlated) with Amg Fq. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amg Fq Long has no effect on the direction of Tekla Healthcare i.e., Tekla Healthcare and Amg Fq go up and down completely randomly.

Pair Corralation between Tekla Healthcare and Amg Fq

Considering the 90-day investment horizon Tekla Healthcare is expected to generate 1.61 times less return on investment than Amg Fq. In addition to that, Tekla Healthcare is 1.38 times more volatile than Amg Fq Long Short. It trades about 0.07 of its total potential returns per unit of risk. Amg Fq Long Short is currently generating about 0.17 per unit of volatility. If you would invest  1,463  in Amg Fq Long Short on August 31, 2024 and sell it today you would earn a total of  748.00  from holding Amg Fq Long Short or generate 51.13% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	99.73%
Values	Daily Returns

Tekla Healthcare Opportunities  vs.  Amg Fq Long Short

Tekla Healthcare Opp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Tekla Healthcare Opportunities has generated negative risk-adjusted returns adding no value to fund investors. Even with relatively invariable technical indicators, Tekla Healthcare is not utilizing all of its potentials. The recent stock price agitation, may contribute to short-term losses for the retail investors.

Amg Fq Long

Risk-Adjusted Performance

17 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Amg Fq Long Short are ranked lower than 17 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak technical and fundamental indicators, Amg Fq may actually be approaching a critical reversion point that can send shares even higher in December 2024.

Pair Trading with Tekla Healthcare and Amg Fq

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

The idea behind Tekla Healthcare Opportunities and Amg Fq Long Short 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.