Correlation Between Agro Capital and Steel Partners
Can any of the company-specific risk be diversified away by investing in both Agro Capital and Steel Partners 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 Agro Capital and Steel Partners into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Agro Capital Management and Steel Partners Holdings, you can compare the effects of market volatilities on Agro Capital and Steel Partners 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 Agro Capital with a short position of Steel Partners. Check out your portfolio center. Please also check ongoing floating volatility patterns of Agro Capital and Steel Partners.
Diversification Opportunities for Agro Capital and Steel Partners
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Agro and Steel is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Agro Capital Management and Steel Partners Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Steel Partners Holdings and Agro Capital 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 Agro Capital Management are associated (or correlated) with Steel Partners. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Steel Partners Holdings has no effect on the direction of Agro Capital i.e., Agro Capital and Steel Partners go up and down completely randomly.
Pair Corralation between Agro Capital and Steel Partners
Given the investment horizon of 90 days Agro Capital Management is expected to generate 7.04 times more return on investment than Steel Partners. However, Agro Capital is 7.04 times more volatile than Steel Partners Holdings. It trades about 0.02 of its potential returns per unit of risk. Steel Partners Holdings is currently generating about 0.02 per unit of risk. If you would invest 6.00 in Agro Capital Management on November 18, 2024 and sell it today you would lose (1.04) from holding Agro Capital Management or give up 17.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Agro Capital Management vs. Steel Partners Holdings
Performance |
| Timeline |
| Agro Capital Management |
| Steel Partners Holdings |
Agro Capital and Steel Partners Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Agro Capital and Steel Partners
The main advantage of trading using opposite Agro Capital and Steel Partners positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Agro Capital position performs unexpectedly, Steel Partners 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 Steel Partners will offset losses from the drop in Steel Partners' long position.| Agro Capital vs. Alliance Recovery | Agro Capital vs. Ayala | Agro Capital vs. Alaska Power Telephone | Agro Capital vs. Ayala Corp ADR |
| Steel Partners vs. Compass Diversified | Steel Partners vs. Compass Diversified | Steel Partners vs. Compass Diversified | Steel Partners vs. Tejon Ranch Co |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
Other Complementary Tools
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA |