Correlation Between AGNC INVESTMENT and Manulife Financial
Can any of the company-specific risk be diversified away by investing in both AGNC INVESTMENT and Manulife 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 AGNC INVESTMENT and Manulife Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AGNC INVESTMENT and Manulife Financial, you can compare the effects of market volatilities on AGNC INVESTMENT and Manulife 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 AGNC INVESTMENT with a short position of Manulife Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of AGNC INVESTMENT and Manulife Financial.
Diversification Opportunities for AGNC INVESTMENT and Manulife Financial
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between AGNC and Manulife is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding AGNC INVESTMENT and Manulife Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Manulife Financial 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 Manulife Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Manulife Financial has no effect on the direction of AGNC INVESTMENT i.e., AGNC INVESTMENT and Manulife Financial go up and down completely randomly.
Pair Corralation between AGNC INVESTMENT and Manulife Financial
Assuming the 90 days trading horizon AGNC INVESTMENT is expected to generate 1.09 times more return on investment than Manulife Financial. However, AGNC INVESTMENT is 1.09 times more volatile than Manulife Financial. It trades about 0.02 of its potential returns per unit of risk. Manulife Financial is currently generating about -0.15 per unit of risk. If you would invest 912.00 in AGNC INVESTMENT on October 26, 2024 and sell it today you would earn a total of 7.00 from holding AGNC INVESTMENT or generate 0.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 97.5% |
| Values | Daily Returns |
AGNC INVESTMENT vs. Manulife Financial
Performance |
| Timeline |
| AGNC INVESTMENT |
| Manulife Financial |
AGNC INVESTMENT and Manulife Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AGNC INVESTMENT and Manulife Financial
The main advantage of trading using opposite AGNC INVESTMENT and Manulife Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AGNC INVESTMENT position performs unexpectedly, Manulife 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 Manulife Financial will offset losses from the drop in Manulife Financial's long position.| AGNC INVESTMENT vs. ATRESMEDIA | AGNC INVESTMENT vs. Platinum Investment Management | AGNC INVESTMENT vs. Waste Management | AGNC INVESTMENT vs. ANTA SPORTS PRODUCT |
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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 the Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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