Correlation Between American Electric and F1R15XK36
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By analyzing existing cross correlation between American Electric Power and BNP Paribas FRN, you can compare the effects of market volatilities on American Electric and F1R15XK36 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 American Electric with a short position of F1R15XK36. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Electric and F1R15XK36.
Diversification Opportunities for American Electric and F1R15XK36
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between American and F1R15XK36 is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding American Electric Power and BNP Paribas FRN in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BNP Paribas FRN and American Electric 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 American Electric Power are associated (or correlated) with F1R15XK36. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BNP Paribas FRN has no effect on the direction of American Electric i.e., American Electric and F1R15XK36 go up and down completely randomly.
Pair Corralation between American Electric and F1R15XK36
Considering the 90-day investment horizon American Electric Power is expected to generate 0.89 times more return on investment than F1R15XK36. However, American Electric Power is 1.12 times less risky than F1R15XK36. It trades about 0.24 of its potential returns per unit of risk. BNP Paribas FRN is currently generating about -0.11 per unit of risk. If you would invest 8,735 in American Electric Power on June 22, 2024 and sell it today you would earn a total of 1,439 from holding American Electric Power or generate 16.47% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 48.39% |
Values | Daily Returns |
American Electric Power vs. BNP Paribas FRN
Performance |
Timeline |
American Electric Power |
BNP Paribas FRN |
American Electric and F1R15XK36 Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with American Electric and F1R15XK36
The main advantage of trading using opposite American Electric and F1R15XK36 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Electric position performs unexpectedly, F1R15XK36 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 F1R15XK36 will offset losses from the drop in F1R15XK36's long position.American Electric vs. Southern Company | American Electric vs. Dominion Energy | American Electric vs. Nextera Energy | American Electric vs. Consolidated Edison |
F1R15XK36 vs. LENSAR Inc | F1R15XK36 vs. PGE Corp | F1R15XK36 vs. Microbot Medical | F1R15XK36 vs. American Electric Power |
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 CEOs Directory module to screen CEOs from public companies around the world.
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