Correlation Between Agritech and Supernet
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By analyzing existing cross correlation between Agritech and Supernet, you can compare the effects of market volatilities on Agritech and Supernet 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 Agritech with a short position of Supernet. Check out your portfolio center. Please also check ongoing floating volatility patterns of Agritech and Supernet.
Diversification Opportunities for Agritech and Supernet
Weak diversification
The 3 months correlation between Agritech and Supernet is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Agritech and Supernet in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Supernet and Agritech 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 Agritech are associated (or correlated) with Supernet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Supernet has no effect on the direction of Agritech i.e., Agritech and Supernet go up and down completely randomly.
Pair Corralation between Agritech and Supernet
Assuming the 90 days trading horizon Agritech is expected to under-perform the Supernet. But the stock apears to be less risky and, when comparing its historical volatility, Agritech is 3.76 times less risky than Supernet. The stock trades about -0.06 of its potential returns per unit of risk. The Supernet is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 1,206 in Supernet on September 12, 2024 and sell it today you would earn a total of 349.00 from holding Supernet or generate 28.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Agritech vs. Supernet
Performance |
| Timeline |
| Agritech |
| Supernet |
Agritech and Supernet Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Agritech and Supernet
The main advantage of trading using opposite Agritech and Supernet positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Agritech position performs unexpectedly, Supernet 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 Supernet will offset losses from the drop in Supernet's long position.| Agritech vs. Masood Textile Mills | Agritech vs. Fauji Foods | Agritech vs. KSB Pumps | Agritech vs. Mari Petroleum |
| Supernet vs. Engro Polymer Chemicals | Supernet vs. Ghani Chemical Industries | Supernet vs. Sindh Modaraba Management | Supernet vs. Agritech |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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