Correlation Between SPACE and AMPL
Can any of the company-specific risk be diversified away by investing in both SPACE and AMPL 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 SPACE and AMPL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SPACE and AMPL, you can compare the effects of market volatilities on SPACE and AMPL 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 SPACE with a short position of AMPL. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPACE and AMPL.
Diversification Opportunities for SPACE and AMPL
Weak diversification
The 3 months correlation between SPACE and AMPL is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding SPACE and AMPL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AMPL and SPACE 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 SPACE are associated (or correlated) with AMPL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AMPL has no effect on the direction of SPACE i.e., SPACE and AMPL go up and down completely randomly.
Pair Corralation between SPACE and AMPL
Assuming the 90 days horizon SPACE is expected to generate 4.62 times less return on investment than AMPL. But when comparing it to its historical volatility, SPACE is 1.2 times less risky than AMPL. It trades about 0.01 of its potential returns per unit of risk. AMPL is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 106.00 in AMPL on June 1, 2025 and sell it today you would earn a total of 7.00 from holding AMPL or generate 6.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SPACE vs. AMPL
Performance |
| Timeline |
| SPACE |
| AMPL |
SPACE and AMPL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SPACE and AMPL
The main advantage of trading using opposite SPACE and AMPL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPACE position performs unexpectedly, AMPL 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 AMPL will offset losses from the drop in AMPL's long position.The idea behind SPACE and AMPL pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 AI Portfolio Prophet module to use AI to generate optimal portfolios and find profitable investment opportunities.
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