Correlation Between Amdocs and Loews Corp
Can any of the company-specific risk be diversified away by investing in both Amdocs and Loews Corp 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 Amdocs and Loews Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amdocs and Loews Corp, you can compare the effects of market volatilities on Amdocs and Loews Corp 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 Amdocs with a short position of Loews Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amdocs and Loews Corp.
Diversification Opportunities for Amdocs and Loews Corp
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Amdocs and Loews is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Amdocs and Loews Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Loews Corp and Amdocs 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 Amdocs are associated (or correlated) with Loews Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Loews Corp has no effect on the direction of Amdocs i.e., Amdocs and Loews Corp go up and down completely randomly.
Pair Corralation between Amdocs and Loews Corp
Considering the 90-day investment horizon Amdocs is expected to generate 1.18 times less return on investment than Loews Corp. But when comparing it to its historical volatility, Amdocs is 1.01 times less risky than Loews Corp. It trades about 0.04 of its potential returns per unit of risk. Loews Corp is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 6,258 in Loews Corp on December 30, 2023 and sell it today you would earn a total of 1,571 from holding Loews Corp or generate 25.1% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Amdocs vs. Loews Corp
Performance |
Timeline |
Amdocs |
Loews Corp |
Amdocs and Loews Corp Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Amdocs and Loews Corp
The main advantage of trading using opposite Amdocs and Loews Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amdocs position performs unexpectedly, Loews Corp 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 Loews Corp will offset losses from the drop in Loews Corp's long position.Amdocs vs. Arch Capital Group | Amdocs vs. Artisan Partners Asset | Amdocs vs. Encore Capital Group | Amdocs vs. Kinsale Capital Group |
Loews Corp vs. Microsoft | Loews Corp vs. Chevron Corp | Loews Corp vs. Caterpillar | Loews Corp vs. Merck Company |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
Other Complementary Tools
FinTech Suite Use AI to screen and filter profitable investment opportunities | |
Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
AI Investment Finder Use AI to screen and filter profitable investment opportunities |