Correlation Between Kibush Capital and Ameriprise Financial

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Can any of the company-specific risk be diversified away by investing in both Kibush Capital and Ameriprise Financial 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 Kibush Capital and Ameriprise Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kibush Capital Corp and Ameriprise Financial Services, you can compare the effects of market volatilities on Kibush Capital and Ameriprise Financial 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 Kibush Capital with a short position of Ameriprise Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kibush Capital and Ameriprise Financial.

Diversification Opportunities for Kibush Capital and Ameriprise Financial

-0.29
  Correlation Coefficient

Very good diversification

The 3 months correlation between Kibush and Ameriprise is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Kibush Capital Corp and Ameriprise Financial Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ameriprise Financial and Kibush Capital 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 Kibush Capital Corp are associated (or correlated) with Ameriprise Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ameriprise Financial has no effect on the direction of Kibush Capital i.e., Kibush Capital and Ameriprise Financial go up and down completely randomly.

Pair Corralation between Kibush Capital and Ameriprise Financial

Given the investment horizon of 90 days Kibush Capital is expected to generate 1.06 times less return on investment than Ameriprise Financial. In addition to that, Kibush Capital is 14.0 times more volatile than Ameriprise Financial Services. It trades about 0.02 of its total potential returns per unit of risk. Ameriprise Financial Services is currently generating about 0.26 per unit of volatility. If you would invest  29,881  in Ameriprise Financial Services on August 28, 2022 and sell it today you would earn a total of  3,360  from holding Ameriprise Financial Services or generate 11.24% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy95.45%
ValuesDaily Returns

Kibush Capital Corp  vs.  Ameriprise Financial Services

 Performance (%) 
       Timeline  
Kibush Capital Corp 
Kibush Performance
7 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Kibush Capital Corp are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Even with relatively fragile fundamental indicators, Kibush Capital reported solid returns over the last few months and may actually be approaching a breakup point.

Kibush Price Channel

Ameriprise Financial 
Ameriprise Performance
11 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Ameriprise Financial Services are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of very weak primary indicators, Ameriprise Financial displayed solid returns over the last few months and may actually be approaching a breakup point.

Ameriprise Price Channel

Kibush Capital and Ameriprise Financial Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Kibush Capital and Ameriprise Financial

The main advantage of trading using opposite Kibush Capital and Ameriprise Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kibush Capital position performs unexpectedly, Ameriprise Financial 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 Ameriprise Financial will offset losses from the drop in Ameriprise Financial's long position.
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The idea behind Kibush Capital Corp and Ameriprise Financial Services 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.
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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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.

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