Correlation Between AGNC INVESTMENT and Guidewire Software
Can any of the company-specific risk be diversified away by investing in both AGNC INVESTMENT and Guidewire Software 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 AGNC INVESTMENT and Guidewire Software into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AGNC INVESTMENT and Guidewire Software, you can compare the effects of market volatilities on AGNC INVESTMENT and Guidewire Software 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 AGNC INVESTMENT with a short position of Guidewire Software. Check out your portfolio center. Please also check ongoing floating volatility patterns of AGNC INVESTMENT and Guidewire Software.
Diversification Opportunities for AGNC INVESTMENT and Guidewire Software
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between AGNC and Guidewire is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding AGNC INVESTMENT and Guidewire Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guidewire Software and AGNC INVESTMENT 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 AGNC INVESTMENT are associated (or correlated) with Guidewire Software. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guidewire Software has no effect on the direction of AGNC INVESTMENT i.e., AGNC INVESTMENT and Guidewire Software go up and down completely randomly.
Pair Corralation between AGNC INVESTMENT and Guidewire Software
Assuming the 90 days trading horizon AGNC INVESTMENT is expected to generate 5.16 times less return on investment than Guidewire Software. But when comparing it to its historical volatility, AGNC INVESTMENT is 1.41 times less risky than Guidewire Software. It trades about 0.03 of its potential returns per unit of risk. Guidewire Software is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 7,050 in Guidewire Software on October 30, 2024 and sell it today you would earn a total of 12,060 from holding Guidewire Software or generate 171.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AGNC INVESTMENT vs. Guidewire Software
Performance |
| Timeline |
| AGNC INVESTMENT |
| Guidewire Software |
AGNC INVESTMENT and Guidewire Software Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AGNC INVESTMENT and Guidewire Software
The main advantage of trading using opposite AGNC INVESTMENT and Guidewire Software positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AGNC INVESTMENT position performs unexpectedly, Guidewire Software 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 Guidewire Software will offset losses from the drop in Guidewire Software's long position.| AGNC INVESTMENT vs. PLAYTIKA HOLDING DL 01 | AGNC INVESTMENT vs. UNIVERSAL DISPLAY | AGNC INVESTMENT vs. PLAYWAY SA ZY 10 | AGNC INVESTMENT vs. Aristocrat Leisure Limited |
| Guidewire Software vs. HEALTHSTREAM | Guidewire Software vs. Burlington Stores | Guidewire Software vs. National Retail Properties | Guidewire Software vs. Fast Retailing Co |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
Other Complementary Tools
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm |