Correlation Between Costco Wholesale and AGF Management
Can any of the company-specific risk be diversified away by investing in both Costco Wholesale 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 Costco Wholesale and AGF Management into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Costco Wholesale Corp and AGF Management Limited, you can compare the effects of market volatilities on Costco Wholesale 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 Costco Wholesale with a short position of AGF Management. Check out your portfolio center. Please also check ongoing floating volatility patterns of Costco Wholesale and AGF Management.
Diversification Opportunities for Costco Wholesale and AGF Management
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Costco and AGF is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Costco Wholesale Corp and AGF Management Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AGF Management and Costco Wholesale 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 Costco Wholesale Corp 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 Costco Wholesale i.e., Costco Wholesale and AGF Management go up and down completely randomly.
Pair Corralation between Costco Wholesale and AGF Management
Assuming the 90 days trading horizon Costco Wholesale Corp is expected to under-perform the AGF Management. But the stock apears to be less risky and, when comparing its historical volatility, Costco Wholesale Corp is 1.49 times less risky than AGF Management. The stock trades about -0.37 of its potential returns per unit of risk. The AGF Management Limited is currently generating about -0.11 of returns per unit of risk over similar time horizon. If you would invest 725.00 in AGF Management Limited on December 13, 2024 and sell it today you would lose (60.00) from holding AGF Management Limited or give up 8.28% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Costco Wholesale Corp vs. AGF Management Limited
Performance |
| Timeline |
| Costco Wholesale Corp |
| AGF Management |
Costco Wholesale and AGF Management Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Costco Wholesale and AGF Management
The main advantage of trading using opposite Costco Wholesale and AGF Management positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Costco Wholesale 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.| Costco Wholesale vs. Perseus Mining Limited | ||
| Costco Wholesale vs. PARKEN Sport Entertainment | ||
| Costco Wholesale vs. ATOSS SOFTWARE | ||
| Costco Wholesale vs. Jacquet Metal Service |
| AGF Management vs. Heidelberg Materials AG | ||
| AGF Management vs. Compagnie Plastic Omnium | ||
| AGF Management vs. ZhongAn Online P | ||
| AGF Management vs. BOS BETTER ONLINE |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
Other Complementary Tools
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance |