Correlation Between Bitcoin and AGCO

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Bitcoin and AGCO 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 Bitcoin and AGCO into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bitcoin and AGCO Corporation, you can compare the effects of market volatilities on Bitcoin and AGCO 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 Bitcoin with a short position of AGCO. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bitcoin and AGCO.

Diversification Opportunities for Bitcoin and AGCO

-0.3
  Correlation Coefficient

Very good diversification

The 3 months correlation between Bitcoin and AGCO is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Bitcoin and AGCO Corp. in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AGCO and Bitcoin 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 Bitcoin are associated (or correlated) with AGCO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AGCO has no effect on the direction of Bitcoin i.e., Bitcoin and AGCO go up and down completely randomly.

Pair Corralation between Bitcoin and AGCO

Assuming the 90 days trading horizon Bitcoin is expected to generate 1.04 times less return on investment than AGCO. In addition to that, Bitcoin is 1.24 times more volatile than AGCO Corporation. It trades about 0.1 of its total potential returns per unit of risk. AGCO Corporation is currently generating about 0.13 per unit of volatility. If you would invest  9,176  in AGCO Corporation on October 20, 2024 and sell it today you would earn a total of  993.00  from holding AGCO Corporation or generate 10.82% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy93.18%
ValuesDaily Returns

Bitcoin  vs.  AGCO Corp.

 Performance 
       Timeline  
Bitcoin 

Risk-Adjusted Performance

17 of 100

 
Weak
 
Strong
Solid
Compared to the overall equity markets, risk-adjusted returns on investments in Bitcoin are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady fundamental indicators, Bitcoin exhibited solid returns over the last few months and may actually be approaching a breakup point.
AGCO 

Risk-Adjusted Performance

2 of 100

 
Weak
 
Strong
Weak
Compared to the overall equity markets, risk-adjusted returns on investments in AGCO Corporation are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy fundamental indicators, AGCO is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Bitcoin and AGCO Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Bitcoin and AGCO

The main advantage of trading using opposite Bitcoin and AGCO positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bitcoin position performs unexpectedly, AGCO 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 AGCO will offset losses from the drop in AGCO's long position.
The idea behind Bitcoin and AGCO Corporation 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.
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..

Other Complementary Tools

Idea Breakdown
Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes
Portfolio Backtesting
Avoid under-diversification and over-optimization by backtesting your portfolios
Piotroski F Score
Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals
Latest Portfolios
Quick portfolio dashboard that showcases your latest portfolios
Commodity Directory
Find actively traded commodities issued by global exchanges