Correlation Between AGF Management and Apple
Can any of the company-specific risk be diversified away by investing in both AGF Management and Apple 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 AGF Management and Apple into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AGF Management Limited and Apple Inc, you can compare the effects of market volatilities on AGF Management and Apple 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 AGF Management with a short position of Apple. Check out your portfolio center. Please also check ongoing floating volatility patterns of AGF Management and Apple.
Diversification Opportunities for AGF Management and Apple
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between AGF and Apple is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding AGF Management Limited and Apple Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apple Inc and AGF Management 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 AGF Management Limited are associated (or correlated) with Apple. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apple Inc has no effect on the direction of AGF Management i.e., AGF Management and Apple go up and down completely randomly.
Pair Corralation between AGF Management and Apple
Assuming the 90 days horizon AGF Management Limited is expected to under-perform the Apple. In addition to that, AGF Management is 1.16 times more volatile than Apple Inc. It trades about -0.02 of its total potential returns per unit of risk. Apple Inc is currently generating about 0.41 per unit of volatility. If you would invest 21,625 in Apple Inc on September 15, 2024 and sell it today you would earn a total of 1,920 from holding Apple Inc or generate 8.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AGF Management Limited vs. Apple Inc
Performance |
| Timeline |
| AGF Management |
| Apple Inc |
AGF Management and Apple Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AGF Management and Apple
The main advantage of trading using opposite AGF Management and Apple positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AGF Management position performs unexpectedly, Apple 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 Apple will offset losses from the drop in Apple's long position.| AGF Management vs. Food Life Companies | AGF Management vs. HK Electric Investments | AGF Management vs. JJ SNACK FOODS | AGF Management vs. Chuangs China Investments |
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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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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