Correlation Between AmTrust Financial and Solaris Energy
Can any of the company-specific risk be diversified away by investing in both AmTrust Financial and Solaris Energy 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 AmTrust Financial and Solaris Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AmTrust Financial Services and Solaris Energy Infrastructure,, you can compare the effects of market volatilities on AmTrust Financial and Solaris Energy 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 AmTrust Financial with a short position of Solaris Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of AmTrust Financial and Solaris Energy.
Diversification Opportunities for AmTrust Financial and Solaris Energy
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between AmTrust and Solaris is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding AmTrust Financial Services and Solaris Energy Infrastructure, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Solaris Energy Infra and AmTrust Financial 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 AmTrust Financial Services are associated (or correlated) with Solaris Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Solaris Energy Infra has no effect on the direction of AmTrust Financial i.e., AmTrust Financial and Solaris Energy go up and down completely randomly.
Pair Corralation between AmTrust Financial and Solaris Energy
Assuming the 90 days horizon AmTrust Financial is expected to generate 142.67 times less return on investment than Solaris Energy. In addition to that, AmTrust Financial is 1.09 times more volatile than Solaris Energy Infrastructure,. It trades about 0.0 of its total potential returns per unit of risk. Solaris Energy Infrastructure, is currently generating about 0.1 per unit of volatility. If you would invest 1,276 in Solaris Energy Infrastructure, on August 1, 2024 and sell it today you would earn a total of 47.00 from holding Solaris Energy Infrastructure, or generate 3.68% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
AmTrust Financial Services vs. Solaris Energy Infrastructure,
Performance |
Timeline |
AmTrust Financial |
Solaris Energy Infra |
AmTrust Financial and Solaris Energy Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with AmTrust Financial and Solaris Energy
The main advantage of trading using opposite AmTrust Financial and Solaris Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AmTrust Financial position performs unexpectedly, Solaris Energy 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 Solaris Energy will offset losses from the drop in Solaris Energy's long position.AmTrust Financial vs. Progressive Corp | AmTrust Financial vs. White Mountains Insurance | AmTrust Financial vs. Chubb | AmTrust Financial vs. W R Berkley |
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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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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