Correlation Between Air Products and AGC
Can any of the company-specific risk be diversified away by investing in both Air Products and AGC 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 Air Products and AGC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Air Products and and AGC Inc, you can compare the effects of market volatilities on Air Products and AGC 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 Air Products with a short position of AGC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Air Products and AGC.
Diversification Opportunities for Air Products and AGC
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Air and AGC is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Air Products and and AGC Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AGC Inc and Air Products 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 Air Products and are associated (or correlated) with AGC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AGC Inc has no effect on the direction of Air Products i.e., Air Products and AGC go up and down completely randomly.
Pair Corralation between Air Products and AGC
If you would invest 30,609 in Air Products and on September 3, 2024 and sell it today you would earn a total of 2,824 from holding Air Products and or generate 9.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 5.0% |
| Values | Daily Returns |
Air Products and vs. AGC Inc
Performance |
| Timeline |
| Air Products |
| AGC Inc |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Air Products and AGC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Air Products and AGC
The main advantage of trading using opposite Air Products and AGC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Air Products position performs unexpectedly, AGC 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 AGC will offset losses from the drop in AGC's long position.| Air Products vs. PPG Industries | Air Products vs. Sherwin Williams Co | Air Products vs. Ecolab Inc | Air Products vs. Albemarle Corp |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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