Correlation Between AGF Management and Biogen
Can any of the company-specific risk be diversified away by investing in both AGF Management and Biogen 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 Biogen 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 Biogen Inc, you can compare the effects of market volatilities on AGF Management and Biogen 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 Biogen. Check out your portfolio center. Please also check ongoing floating volatility patterns of AGF Management and Biogen.
Diversification Opportunities for AGF Management and Biogen
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between AGF and Biogen is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding AGF Management Limited and Biogen Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Biogen 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 Biogen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Biogen Inc has no effect on the direction of AGF Management i.e., AGF Management and Biogen go up and down completely randomly.
Pair Corralation between AGF Management and Biogen
Assuming the 90 days horizon AGF Management Limited is expected to generate 1.19 times more return on investment than Biogen. However, AGF Management is 1.19 times more volatile than Biogen Inc. It trades about 0.05 of its potential returns per unit of risk. Biogen Inc is currently generating about -0.08 per unit of risk. If you would invest 730.00 in AGF Management Limited on November 27, 2024 and sell it today you would earn a total of 15.00 from holding AGF Management Limited or generate 2.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AGF Management Limited vs. Biogen Inc
Performance |
| Timeline |
| AGF Management |
| Biogen Inc |
AGF Management and Biogen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AGF Management and Biogen
The main advantage of trading using opposite AGF Management and Biogen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AGF Management position performs unexpectedly, Biogen 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 Biogen will offset losses from the drop in Biogen's long position.| AGF Management vs. Stag Industrial | AGF Management vs. X FAB Silicon Foundries | AGF Management vs. Kingdee International Software | AGF Management vs. Check Point Software |
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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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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