Correlation Between Agilent Technologies and Trip Group
Can any of the company-specific risk be diversified away by investing in both Agilent Technologies and Trip 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 Agilent Technologies and Trip Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Agilent Technologies and Trip Group Limited, you can compare the effects of market volatilities on Agilent Technologies and Trip 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 Agilent Technologies with a short position of Trip Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Agilent Technologies and Trip Group.
Diversification Opportunities for Agilent Technologies and Trip Group
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Agilent and Trip is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Agilent Technologies and Trip Group Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trip Group Limited and Agilent Technologies 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 Agilent Technologies are associated (or correlated) with Trip Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trip Group Limited has no effect on the direction of Agilent Technologies i.e., Agilent Technologies and Trip Group go up and down completely randomly.
Pair Corralation between Agilent Technologies and Trip Group
Assuming the 90 days horizon Agilent Technologies is expected to generate 1.22 times less return on investment than Trip Group. But when comparing it to its historical volatility, Agilent Technologies is 1.12 times less risky than Trip Group. It trades about 0.21 of its potential returns per unit of risk. Trip Group Limited is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 6,260 in Trip Group Limited on November 5, 2024 and sell it today you would earn a total of 580.00 from holding Trip Group Limited or generate 9.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Agilent Technologies vs. Trip Group Limited
Performance |
| Timeline |
| Agilent Technologies |
| Trip Group Limited |
Agilent Technologies and Trip Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Agilent Technologies and Trip Group
The main advantage of trading using opposite Agilent Technologies and Trip Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Agilent Technologies position performs unexpectedly, Trip 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 Trip Group will offset losses from the drop in Trip Group's long position.| Agilent Technologies vs. JSC Halyk bank | Agilent Technologies vs. COREBRIDGE FINANCIAL INC | Agilent Technologies vs. De Grey Mining | Agilent Technologies vs. PNC Financial Services |
| Trip Group vs. Booking Holdings | Trip Group vs. Oriental Land Co | Trip Group vs. ANTA Sports Products | Trip Group vs. Li Ning Company |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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