Correlation Between Agricultural Bank and ANZ Group
Can any of the company-specific risk be diversified away by investing in both Agricultural Bank and ANZ Group 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 Agricultural Bank and ANZ Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Agricultural Bank of and ANZ Group Holdings, you can compare the effects of market volatilities on Agricultural Bank and ANZ Group 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 Agricultural Bank with a short position of ANZ Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Agricultural Bank and ANZ Group.
Diversification Opportunities for Agricultural Bank and ANZ Group
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between Agricultural and ANZ is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Agricultural Bank of and ANZ Group Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ANZ Group Holdings and Agricultural Bank 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 Agricultural Bank of are associated (or correlated) with ANZ Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ANZ Group Holdings has no effect on the direction of Agricultural Bank i.e., Agricultural Bank and ANZ Group go up and down completely randomly.
Pair Corralation between Agricultural Bank and ANZ Group
Assuming the 90 days horizon Agricultural Bank of is expected to generate 1.19 times more return on investment than ANZ Group. However, Agricultural Bank is 1.19 times more volatile than ANZ Group Holdings. It trades about 0.08 of its potential returns per unit of risk. ANZ Group Holdings is currently generating about 0.04 per unit of risk. If you would invest 792.00 in Agricultural Bank of on January 21, 2025 and sell it today you would earn a total of 644.00 from holding Agricultural Bank of or generate 81.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Agricultural Bank of vs. ANZ Group Holdings
Performance |
| Timeline |
| Agricultural Bank |
| ANZ Group Holdings |
Agricultural Bank and ANZ Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Agricultural Bank and ANZ Group
The main advantage of trading using opposite Agricultural Bank and ANZ Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Agricultural Bank position performs unexpectedly, ANZ Group 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 ANZ Group will offset losses from the drop in ANZ Group's long position.| Agricultural Bank vs. Industrial Commercial Bank | Agricultural Bank vs. China Construction Bank | Agricultural Bank vs. Bank of America | Agricultural Bank vs. China Construction Bank |
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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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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