Correlation Between Argan and AMREP
Can any of the company-specific risk be diversified away by investing in both Argan and AMREP 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 Argan and AMREP into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Argan Inc and AMREP, you can compare the effects of market volatilities on Argan and AMREP 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 Argan with a short position of AMREP. Check out your portfolio center. Please also check ongoing floating volatility patterns of Argan and AMREP.
Diversification Opportunities for Argan and AMREP
Very good diversification
The 3 months correlation between Argan and AMREP is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Argan Inc and AMREP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AMREP and Argan 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 Argan Inc are associated (or correlated) with AMREP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AMREP has no effect on the direction of Argan i.e., Argan and AMREP go up and down completely randomly.
Pair Corralation between Argan and AMREP
Considering the 90-day investment horizon Argan Inc is expected to generate 1.12 times more return on investment than AMREP. However, Argan is 1.12 times more volatile than AMREP. It trades about 0.25 of its potential returns per unit of risk. AMREP is currently generating about 0.01 per unit of risk. If you would invest 15,285 in Argan Inc on April 30, 2025 and sell it today you would earn a total of 8,404 from holding Argan Inc or generate 54.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Argan Inc vs. AMREP
Performance |
| Timeline |
| Argan Inc |
| AMREP |
Argan and AMREP Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Argan and AMREP
The main advantage of trading using opposite Argan and AMREP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Argan position performs unexpectedly, AMREP 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 AMREP will offset losses from the drop in AMREP's long position.| Argan vs. Api Group Corp | Argan vs. Great Lakes Dredge | Argan vs. Granite Construction Incorporated | Argan vs. Arcosa Inc |
| AMREP vs. Alexanders | AMREP vs. American Realty Investors | AMREP vs. Forestar Group | AMREP vs. Five Point Holdings |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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