Correlation Between Ag Growth and Helix Applications
Can any of the company-specific risk be diversified away by investing in both Ag Growth and Helix Applications 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 Ag Growth and Helix Applications into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ag Growth International and Helix Applications, you can compare the effects of market volatilities on Ag Growth and Helix Applications 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 Ag Growth with a short position of Helix Applications. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ag Growth and Helix Applications.
Diversification Opportunities for Ag Growth and Helix Applications
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between AGGZF and Helix is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Ag Growth International and Helix Applications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Helix Applications and Ag Growth 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 Ag Growth International are associated (or correlated) with Helix Applications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Helix Applications has no effect on the direction of Ag Growth i.e., Ag Growth and Helix Applications go up and down completely randomly.
Pair Corralation between Ag Growth and Helix Applications
Assuming the 90 days horizon Ag Growth International is expected to generate 0.74 times more return on investment than Helix Applications. However, Ag Growth International is 1.35 times less risky than Helix Applications. It trades about -0.06 of its potential returns per unit of risk. Helix Applications is currently generating about -0.13 per unit of risk. If you would invest 4,069 in Ag Growth International on September 3, 2024 and sell it today you would lose (292.00) from holding Ag Growth International or give up 7.18% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 96.92% |
| Values | Daily Returns |
Ag Growth International vs. Helix Applications
Performance |
| Timeline |
| Ag Growth International |
| Helix Applications |
Ag Growth and Helix Applications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ag Growth and Helix Applications
The main advantage of trading using opposite Ag Growth and Helix Applications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ag Growth position performs unexpectedly, Helix Applications 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 Helix Applications will offset losses from the drop in Helix Applications' long position.| Ag Growth vs. First Tractor | Ag Growth vs. AmeraMex International | Ag Growth vs. Arts Way Manufacturing Co | Ag Growth vs. American Premium Water |
| Helix Applications vs. First Tractor | Helix Applications vs. Ag Growth International | Helix Applications vs. AmeraMex International | Helix Applications vs. Arts Way Manufacturing 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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