Correlation Between Agile Group and China Vanke
Can any of the company-specific risk be diversified away by investing in both Agile Group and China Vanke 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 Agile Group and China Vanke into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Agile Group Holdings and China Vanke Co, you can compare the effects of market volatilities on Agile Group and China Vanke 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 Agile Group with a short position of China Vanke. Check out your portfolio center. Please also check ongoing floating volatility patterns of Agile Group and China Vanke.
Diversification Opportunities for Agile Group and China Vanke
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Agile and China is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Agile Group Holdings and China Vanke Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Vanke and Agile Group 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 Agile Group Holdings are associated (or correlated) with China Vanke. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Vanke has no effect on the direction of Agile Group i.e., Agile Group and China Vanke go up and down completely randomly.
Pair Corralation between Agile Group and China Vanke
Assuming the 90 days horizon Agile Group Holdings is expected to generate 2.54 times more return on investment than China Vanke. However, Agile Group is 2.54 times more volatile than China Vanke Co. It trades about 0.03 of its potential returns per unit of risk. China Vanke Co is currently generating about 0.0 per unit of risk. If you would invest 1,100 in Agile Group Holdings on August 31, 2024 and sell it today you would lose (610.00) from holding Agile Group Holdings or give up 55.45% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Agile Group Holdings vs. China Vanke Co
Performance |
| Timeline |
| Agile Group Holdings |
| China Vanke |
Agile Group and China Vanke Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Agile Group and China Vanke
The main advantage of trading using opposite Agile Group and China Vanke positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Agile Group position performs unexpectedly, China Vanke 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 China Vanke will offset losses from the drop in China Vanke's long position.| Agile Group vs. China Resources Land | Agile Group vs. Sun Hung Kai | Agile Group vs. China Overseas Land | Agile Group vs. EGRNF |
| China Vanke vs. HUMANA INC | China Vanke vs. SCOR PK | China Vanke vs. Aquagold International | China Vanke vs. Thrivent High Yield |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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