Correlation Between ABN AMRO and Columbus Acquisition
Can any of the company-specific risk be diversified away by investing in both ABN AMRO and Columbus Acquisition 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 ABN AMRO and Columbus Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ABN AMRO Bank and Columbus Acquisition Corp, you can compare the effects of market volatilities on ABN AMRO and Columbus Acquisition 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 ABN AMRO with a short position of Columbus Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of ABN AMRO and Columbus Acquisition.
Diversification Opportunities for ABN AMRO and Columbus Acquisition
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between ABN and Columbus is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding ABN AMRO Bank and Columbus Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Columbus Acquisition Corp and ABN AMRO 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 ABN AMRO Bank are associated (or correlated) with Columbus Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Columbus Acquisition Corp has no effect on the direction of ABN AMRO i.e., ABN AMRO and Columbus Acquisition go up and down completely randomly.
Pair Corralation between ABN AMRO and Columbus Acquisition
Assuming the 90 days horizon ABN AMRO Bank is expected to generate 9.43 times more return on investment than Columbus Acquisition. However, ABN AMRO is 9.43 times more volatile than Columbus Acquisition Corp. It trades about 0.15 of its potential returns per unit of risk. Columbus Acquisition Corp is currently generating about 0.08 per unit of risk. If you would invest 2,948 in ABN AMRO Bank on September 4, 2025 and sell it today you would earn a total of 441.00 from holding ABN AMRO Bank or generate 14.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ABN AMRO Bank vs. Columbus Acquisition Corp
Performance |
| Timeline |
| ABN AMRO Bank |
| Columbus Acquisition Corp |
ABN AMRO and Columbus Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ABN AMRO and Columbus Acquisition
The main advantage of trading using opposite ABN AMRO and Columbus Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ABN AMRO position performs unexpectedly, Columbus Acquisition 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 Columbus Acquisition will offset losses from the drop in Columbus Acquisition's long position.| ABN AMRO vs. JPMorgan Chase Co | ABN AMRO vs. Bank of America | ABN AMRO vs. Bank of America | ABN AMRO vs. Wells Fargo |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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