Correlation Between Bird Construction and Ag Growth
Can any of the company-specific risk be diversified away by investing in both Bird Construction and Ag Growth 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 Bird Construction and Ag Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bird Construction and Ag Growth International, you can compare the effects of market volatilities on Bird Construction and Ag Growth 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 Bird Construction with a short position of Ag Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bird Construction and Ag Growth.
Diversification Opportunities for Bird Construction and Ag Growth
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Bird and AFN is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Bird Construction and Ag Growth International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ag Growth International and Bird Construction 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 Bird Construction are associated (or correlated) with Ag Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ag Growth International has no effect on the direction of Bird Construction i.e., Bird Construction and Ag Growth go up and down completely randomly.
Pair Corralation between Bird Construction and Ag Growth
Assuming the 90 days trading horizon Bird Construction is expected to generate 11.58 times less return on investment than Ag Growth. In addition to that, Bird Construction is 1.67 times more volatile than Ag Growth International. It trades about 0.01 of its total potential returns per unit of risk. Ag Growth International is currently generating about 0.2 per unit of volatility. If you would invest 4,869 in Ag Growth International on August 29, 2024 and sell it today you would earn a total of 329.00 from holding Ag Growth International or generate 6.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bird Construction vs. Ag Growth International
Performance |
| Timeline |
| Bird Construction |
| Ag Growth International |
Bird Construction and Ag Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bird Construction and Ag Growth
The main advantage of trading using opposite Bird Construction and Ag Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bird Construction position performs unexpectedly, Ag Growth 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 Ag Growth will offset losses from the drop in Ag Growth's long position.| Bird Construction vs. Aecon Group | Bird Construction vs. Mullen Group | Bird Construction vs. Wajax | Bird Construction vs. Exchange Income |
| Ag Growth vs. Exchange Income | Ag Growth vs. Stella Jones | Ag Growth vs. Superior Plus Corp | Ag Growth vs. NFI Group |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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