Correlation Between Agrify Corp and Reliant Holdings
Can any of the company-specific risk be diversified away by investing in both Agrify Corp and Reliant Holdings 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 Agrify Corp and Reliant Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Agrify Corp and Reliant Holdings, you can compare the effects of market volatilities on Agrify Corp and Reliant Holdings 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 Agrify Corp with a short position of Reliant Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Agrify Corp and Reliant Holdings.
Diversification Opportunities for Agrify Corp and Reliant Holdings
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Agrify and Reliant is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Agrify Corp and Reliant Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Reliant Holdings and Agrify Corp 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 Agrify Corp are associated (or correlated) with Reliant Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Reliant Holdings has no effect on the direction of Agrify Corp i.e., Agrify Corp and Reliant Holdings go up and down completely randomly.
Pair Corralation between Agrify Corp and Reliant Holdings
Given the investment horizon of 90 days Agrify Corp is expected to generate 8.97 times less return on investment than Reliant Holdings. But when comparing it to its historical volatility, Agrify Corp is 2.12 times less risky than Reliant Holdings. It trades about 0.02 of its potential returns per unit of risk. Reliant Holdings is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 13.00 in Reliant Holdings on November 2, 2024 and sell it today you would lose (2.00) from holding Reliant Holdings or give up 15.38% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.6% |
| Values | Daily Returns |
Agrify Corp vs. Reliant Holdings
Performance |
| Timeline |
| Agrify Corp |
| Reliant Holdings |
Agrify Corp and Reliant Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Agrify Corp and Reliant Holdings
The main advantage of trading using opposite Agrify Corp and Reliant Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Agrify Corp position performs unexpectedly, Reliant Holdings 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 Reliant Holdings will offset losses from the drop in Reliant Holdings' long position.| Agrify Corp vs. MYR Group | Agrify Corp vs. Granite Construction Incorporated | Agrify Corp vs. Construction Partners | Agrify Corp vs. Great Lakes Dredge |
| Reliant Holdings vs. Aecon Group | Reliant Holdings vs. Argan Inc | Reliant Holdings vs. Agrify Corp | Reliant Holdings vs. Cardno Limited |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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