Correlation Between China Resources and AGF Management
Can any of the company-specific risk be diversified away by investing in both China Resources and AGF Management 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 China Resources and AGF Management into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between China Resources Beer and AGF Management Limited, you can compare the effects of market volatilities on China Resources and AGF Management 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 China Resources with a short position of AGF Management. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Resources and AGF Management.
Diversification Opportunities for China Resources and AGF Management
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between China and AGF is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding China Resources Beer and AGF Management Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AGF Management and China Resources 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 China Resources Beer are associated (or correlated) with AGF Management. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AGF Management has no effect on the direction of China Resources i.e., China Resources and AGF Management go up and down completely randomly.
Pair Corralation between China Resources and AGF Management
Assuming the 90 days horizon China Resources is expected to generate 3.44 times less return on investment than AGF Management. In addition to that, China Resources is 2.02 times more volatile than AGF Management Limited. It trades about 0.01 of its total potential returns per unit of risk. AGF Management Limited is currently generating about 0.1 per unit of volatility. If you would invest 521.00 in AGF Management Limited on October 17, 2024 and sell it today you would earn a total of 154.00 from holding AGF Management Limited or generate 29.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Resources Beer vs. AGF Management Limited
Performance |
| Timeline |
| China Resources Beer |
| AGF Management |
China Resources and AGF Management Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Resources and AGF Management
The main advantage of trading using opposite China Resources and AGF Management positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Resources position performs unexpectedly, AGF Management 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 AGF Management will offset losses from the drop in AGF Management's long position.| China Resources vs. Automatic Data Processing | China Resources vs. Molina Healthcare | China Resources vs. US Physical Therapy | China Resources vs. SILVER BULLET DATA |
| AGF Management vs. X FAB Silicon Foundries | AGF Management vs. SILICON LABORATOR | AGF Management vs. Siamgas And Petrochemicals | AGF Management vs. China Resources Beer |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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