Correlation Between REGAL ASIAN and AGRICUL BK
Can any of the company-specific risk be diversified away by investing in both REGAL ASIAN and AGRICUL BK 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 REGAL ASIAN and AGRICUL BK into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between REGAL ASIAN INVESTMENTS and AGRICUL BK CHINA H , you can compare the effects of market volatilities on REGAL ASIAN and AGRICUL BK 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 REGAL ASIAN with a short position of AGRICUL BK. Check out your portfolio center. Please also check ongoing floating volatility patterns of REGAL ASIAN and AGRICUL BK.
Diversification Opportunities for REGAL ASIAN and AGRICUL BK
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between REGAL and AGRICUL is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding REGAL ASIAN INVESTMENTS and AGRICUL BK CHINA H in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AGRICUL BK CHINA and REGAL ASIAN 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 REGAL ASIAN INVESTMENTS are associated (or correlated) with AGRICUL BK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AGRICUL BK CHINA has no effect on the direction of REGAL ASIAN i.e., REGAL ASIAN and AGRICUL BK go up and down completely randomly.
Pair Corralation between REGAL ASIAN and AGRICUL BK
Assuming the 90 days trading horizon REGAL ASIAN is expected to generate 6.52 times less return on investment than AGRICUL BK. But when comparing it to its historical volatility, REGAL ASIAN INVESTMENTS is 4.24 times less risky than AGRICUL BK. It trades about 0.04 of its potential returns per unit of risk. AGRICUL BK CHINA H is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 15.00 in AGRICUL BK CHINA H on August 29, 2024 and sell it today you would earn a total of 31.00 from holding AGRICUL BK CHINA H or generate 206.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
REGAL ASIAN INVESTMENTS vs. AGRICUL BK CHINA H
Performance |
| Timeline |
| REGAL ASIAN INVESTMENTS |
| AGRICUL BK CHINA |
REGAL ASIAN and AGRICUL BK Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with REGAL ASIAN and AGRICUL BK
The main advantage of trading using opposite REGAL ASIAN and AGRICUL BK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if REGAL ASIAN position performs unexpectedly, AGRICUL BK 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 AGRICUL BK will offset losses from the drop in AGRICUL BK's long position.| REGAL ASIAN vs. Apple Inc | REGAL ASIAN vs. Apple Inc | REGAL ASIAN vs. Apple Inc | REGAL ASIAN vs. Apple Inc |
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 CEOs Directory module to screen CEOs from public companies around the world.
Other Complementary Tools
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios |