Correlation Between DBT SA and Agrogeneration
Can any of the company-specific risk be diversified away by investing in both DBT SA and Agrogeneration 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 DBT SA and Agrogeneration into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DBT SA and Agrogeneration, you can compare the effects of market volatilities on DBT SA and Agrogeneration 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 DBT SA with a short position of Agrogeneration. Check out your portfolio center. Please also check ongoing floating volatility patterns of DBT SA and Agrogeneration.
Diversification Opportunities for DBT SA and Agrogeneration
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between DBT and Agrogeneration is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding DBT SA and Agrogeneration in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Agrogeneration and DBT SA 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 DBT SA are associated (or correlated) with Agrogeneration. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Agrogeneration has no effect on the direction of DBT SA i.e., DBT SA and Agrogeneration go up and down completely randomly.
Pair Corralation between DBT SA and Agrogeneration
Assuming the 90 days trading horizon DBT SA is expected to under-perform the Agrogeneration. But the stock apears to be less risky and, when comparing its historical volatility, DBT SA is 1.48 times less risky than Agrogeneration. The stock trades about -0.08 of its potential returns per unit of risk. The Agrogeneration is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 5.92 in Agrogeneration on October 25, 2024 and sell it today you would lose (0.14) from holding Agrogeneration or give up 2.36% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
DBT SA vs. Agrogeneration
Performance |
| Timeline |
| DBT SA |
| Agrogeneration |
DBT SA and Agrogeneration Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DBT SA and Agrogeneration
The main advantage of trading using opposite DBT SA and Agrogeneration positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DBT SA position performs unexpectedly, Agrogeneration 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 Agrogeneration will offset losses from the drop in Agrogeneration's long position.The idea behind DBT SA and Agrogeneration pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Agrogeneration vs. Acheter Louer | Agrogeneration vs. Avenir Telecom SA | Agrogeneration vs. DBT SA | Agrogeneration vs. Europlasma SA |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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