Correlation Between Carabao Group and Agripure Holdings
Can any of the company-specific risk be diversified away by investing in both Carabao Group and Agripure Holdings 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 Carabao Group and Agripure Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Carabao Group Public and Agripure Holdings Public, you can compare the effects of market volatilities on Carabao Group and Agripure Holdings 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 Carabao Group with a short position of Agripure Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Carabao Group and Agripure Holdings.
Diversification Opportunities for Carabao Group and Agripure Holdings
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Carabao and Agripure is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Carabao Group Public and Agripure Holdings Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Agripure Holdings Public and Carabao Group 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 Carabao Group Public are associated (or correlated) with Agripure Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Agripure Holdings Public has no effect on the direction of Carabao Group i.e., Carabao Group and Agripure Holdings go up and down completely randomly.
Pair Corralation between Carabao Group and Agripure Holdings
Assuming the 90 days trading horizon Carabao Group Public is expected to generate 1.4 times more return on investment than Agripure Holdings. However, Carabao Group is 1.4 times more volatile than Agripure Holdings Public. It trades about 0.01 of its potential returns per unit of risk. Agripure Holdings Public is currently generating about -0.01 per unit of risk. If you would invest 7,950 in Carabao Group Public on August 25, 2024 and sell it today you would earn a total of 0.00 from holding Carabao Group Public or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Carabao Group Public vs. Agripure Holdings Public
Performance |
| Timeline |
| Carabao Group Public |
| Agripure Holdings Public |
Carabao Group and Agripure Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Carabao Group and Agripure Holdings
The main advantage of trading using opposite Carabao Group and Agripure Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Carabao Group position performs unexpectedly, Agripure Holdings 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 Agripure Holdings will offset losses from the drop in Agripure Holdings' long position.| Carabao Group vs. CP ALL Public | Carabao Group vs. Minor International Public | Carabao Group vs. Srisawad Power 1979 | Carabao Group vs. Home Product Center |
| Agripure Holdings vs. CP ALL Public | Agripure Holdings vs. Carabao Group Public | Agripure Holdings vs. Thai Union Group | Agripure Holdings vs. Minor International Public |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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