Correlation Between AGNC INVESTMENT and PETCO HEALTH
Can any of the company-specific risk be diversified away by investing in both AGNC INVESTMENT and PETCO HEALTH 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 PETCO HEALTH into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AGNC INVESTMENT and PETCO HEALTH CLA, you can compare the effects of market volatilities on AGNC INVESTMENT and PETCO HEALTH 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 PETCO HEALTH. Check out your portfolio center. Please also check ongoing floating volatility patterns of AGNC INVESTMENT and PETCO HEALTH.
Diversification Opportunities for AGNC INVESTMENT and PETCO HEALTH
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between AGNC and PETCO is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding AGNC INVESTMENT and PETCO HEALTH CLA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PETCO HEALTH CLA 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 PETCO HEALTH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PETCO HEALTH CLA has no effect on the direction of AGNC INVESTMENT i.e., AGNC INVESTMENT and PETCO HEALTH go up and down completely randomly.
Pair Corralation between AGNC INVESTMENT and PETCO HEALTH
Assuming the 90 days trading horizon AGNC INVESTMENT is expected to generate 0.46 times more return on investment than PETCO HEALTH. However, AGNC INVESTMENT is 2.18 times less risky than PETCO HEALTH. It trades about 0.22 of its potential returns per unit of risk. PETCO HEALTH CLA is currently generating about -0.12 per unit of risk. If you would invest 894.00 in AGNC INVESTMENT on October 25, 2024 and sell it today you would earn a total of 43.00 from holding AGNC INVESTMENT or generate 4.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AGNC INVESTMENT vs. PETCO HEALTH CLA
Performance |
| Timeline |
| AGNC INVESTMENT |
| PETCO HEALTH CLA |
AGNC INVESTMENT and PETCO HEALTH Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AGNC INVESTMENT and PETCO HEALTH
The main advantage of trading using opposite AGNC INVESTMENT and PETCO HEALTH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AGNC INVESTMENT position performs unexpectedly, PETCO HEALTH 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 PETCO HEALTH will offset losses from the drop in PETCO HEALTH's long position.| AGNC INVESTMENT vs. Apple Inc | AGNC INVESTMENT vs. Apple Inc | AGNC INVESTMENT vs. Apple Inc | AGNC INVESTMENT vs. Apple Inc |
| PETCO HEALTH vs. MercadoLibre | PETCO HEALTH vs. OReilly Automotive | PETCO HEALTH vs. Tractor Supply | PETCO HEALTH vs. Ulta Beauty |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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