Correlation Between Amedica WT and MetLife
Can any of the company-specific risk be diversified away by investing in both Amedica WT and MetLife 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 Amedica WT and MetLife into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amedica WT and MetLife, you can compare the effects of market volatilities on Amedica WT and MetLife 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 Amedica WT with a short position of MetLife. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amedica WT and MetLife.
Diversification Opportunities for Amedica WT and MetLife
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Amedica and MetLife is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Amedica WT and MetLife in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MetLife and Amedica WT 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 Amedica WT are associated (or correlated) with MetLife. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MetLife has no effect on the direction of Amedica WT i.e., Amedica WT and MetLife go up and down completely randomly.
Pair Corralation between Amedica WT and MetLife
Assuming the 90 days horizon Amedica WT is expected to generate 58.43 times more return on investment than MetLife. However, Amedica WT is 58.43 times more volatile than MetLife. It trades about 0.18 of its potential returns per unit of risk. MetLife is currently generating about 0.02 per unit of risk. If you would invest 1.50 in Amedica WT on January 24, 2024 and sell it today you would lose (1.46) from holding Amedica WT or give up 97.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 11.52% |
| Values | Daily Returns |
Amedica WT vs. MetLife
Performance |
| Timeline |
| Amedica WT |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| MetLife |
Amedica WT and MetLife Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amedica WT and MetLife
The main advantage of trading using opposite Amedica WT and MetLife positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amedica WT position performs unexpectedly, MetLife 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 MetLife will offset losses from the drop in MetLife's long position.| Amedica WT vs. American Video Teleconferencing | Amedica WT vs. Xunlei Ltd Adr | Amedica WT vs. Datadog | Amedica WT vs. 51Talk Online Education |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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