Correlation Between CAIRN HOMES and AGNC INVESTMENT
Can any of the company-specific risk be diversified away by investing in both CAIRN HOMES and AGNC INVESTMENT 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 CAIRN HOMES and AGNC INVESTMENT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CAIRN HOMES EO and AGNC INVESTMENT, you can compare the effects of market volatilities on CAIRN HOMES and AGNC INVESTMENT 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 CAIRN HOMES with a short position of AGNC INVESTMENT. Check out your portfolio center. Please also check ongoing floating volatility patterns of CAIRN HOMES and AGNC INVESTMENT.
Diversification Opportunities for CAIRN HOMES and AGNC INVESTMENT
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between CAIRN and AGNC is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding CAIRN HOMES EO and AGNC INVESTMENT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AGNC INVESTMENT and CAIRN HOMES 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 CAIRN HOMES EO are associated (or correlated) with AGNC INVESTMENT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AGNC INVESTMENT has no effect on the direction of CAIRN HOMES i.e., CAIRN HOMES and AGNC INVESTMENT go up and down completely randomly.
Pair Corralation between CAIRN HOMES and AGNC INVESTMENT
Assuming the 90 days horizon CAIRN HOMES EO is expected to under-perform the AGNC INVESTMENT. In addition to that, CAIRN HOMES is 2.22 times more volatile than AGNC INVESTMENT. It trades about -0.03 of its total potential returns per unit of risk. AGNC INVESTMENT is currently generating about 0.09 per unit of volatility. If you would invest 886.00 in AGNC INVESTMENT on October 19, 2024 and sell it today you would earn a total of 36.00 from holding AGNC INVESTMENT or generate 4.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CAIRN HOMES EO vs. AGNC INVESTMENT
Performance |
| Timeline |
| CAIRN HOMES EO |
| AGNC INVESTMENT |
CAIRN HOMES and AGNC INVESTMENT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CAIRN HOMES and AGNC INVESTMENT
The main advantage of trading using opposite CAIRN HOMES and AGNC INVESTMENT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CAIRN HOMES position performs unexpectedly, AGNC INVESTMENT 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 AGNC INVESTMENT will offset losses from the drop in AGNC INVESTMENT's long position.| CAIRN HOMES vs. Tokyu Construction Co | CAIRN HOMES vs. Yuexiu Transport Infrastructure | CAIRN HOMES vs. ALEFARM BREWING DK 05 | CAIRN HOMES vs. FIREWEED METALS P |
| AGNC INVESTMENT vs. ecotel communication ag | AGNC INVESTMENT vs. Khiron Life Sciences | AGNC INVESTMENT vs. Zoom Video Communications | AGNC INVESTMENT vs. The Japan Steel |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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