Correlation Between Aama Equity and Hennessy
Can any of the company-specific risk be diversified away by investing in both Aama Equity and Hennessy 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 Aama Equity and Hennessy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aama Equity Fund and Hennessy Bp Energy, you can compare the effects of market volatilities on Aama Equity and Hennessy 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 Aama Equity with a short position of Hennessy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aama Equity and Hennessy.
Diversification Opportunities for Aama Equity and Hennessy
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Aama and Hennessy is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Aama Equity Fund and Hennessy Bp Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hennessy Bp Energy and Aama Equity 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 Aama Equity Fund are associated (or correlated) with Hennessy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hennessy Bp Energy has no effect on the direction of Aama Equity i.e., Aama Equity and Hennessy go up and down completely randomly.
Pair Corralation between Aama Equity and Hennessy
If you would invest 2,680 in Hennessy Bp Energy on February 20, 2024 and sell it today you would earn a total of 65.00 from holding Hennessy Bp Energy or generate 2.43% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 0.0% |
Values | Daily Returns |
Aama Equity Fund vs. Hennessy Bp Energy
Performance |
Timeline |
Aama Equity Fund |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Good
Hennessy Bp Energy |
Aama Equity and Hennessy Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Aama Equity and Hennessy
The main advantage of trading using opposite Aama Equity and Hennessy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aama Equity position performs unexpectedly, Hennessy 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 Hennessy will offset losses from the drop in Hennessy's long position.Aama Equity vs. Financials Ultrasector Profund | Aama Equity vs. Blackrock Financial Institutions | Aama Equity vs. Prudential Jennison Financial | Aama Equity vs. Gabelli Global Financial |
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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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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