Correlation Between AGRICUL BK and Lekoil
Can any of the company-specific risk be diversified away by investing in both AGRICUL BK and Lekoil 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 AGRICUL BK and Lekoil into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AGRICUL BK CHINA H and Lekoil Limited, you can compare the effects of market volatilities on AGRICUL BK and Lekoil 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 AGRICUL BK with a short position of Lekoil. Check out your portfolio center. Please also check ongoing floating volatility patterns of AGRICUL BK and Lekoil.
Diversification Opportunities for AGRICUL BK and Lekoil
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between AGRICUL and Lekoil is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding AGRICUL BK CHINA H and Lekoil Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lekoil Limited and AGRICUL BK 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 AGRICUL BK CHINA H are associated (or correlated) with Lekoil. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lekoil Limited has no effect on the direction of AGRICUL BK i.e., AGRICUL BK and Lekoil go up and down completely randomly.
Pair Corralation between AGRICUL BK and Lekoil
Assuming the 90 days trading horizon AGRICUL BK CHINA H is expected to generate 0.24 times more return on investment than Lekoil. However, AGRICUL BK CHINA H is 4.12 times less risky than Lekoil. It trades about 0.16 of its potential returns per unit of risk. Lekoil Limited is currently generating about -0.05 per unit of risk. If you would invest 41.00 in AGRICUL BK CHINA H on August 30, 2024 and sell it today you would earn a total of 6.00 from holding AGRICUL BK CHINA H or generate 14.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 97.73% |
| Values | Daily Returns |
AGRICUL BK CHINA H vs. Lekoil Limited
Performance |
| Timeline |
| AGRICUL BK CHINA |
| Lekoil Limited |
AGRICUL BK and Lekoil Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AGRICUL BK and Lekoil
The main advantage of trading using opposite AGRICUL BK and Lekoil positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AGRICUL BK position performs unexpectedly, Lekoil 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 Lekoil will offset losses from the drop in Lekoil's long position.| AGRICUL BK vs. Apple Inc | AGRICUL BK vs. Apple Inc | AGRICUL BK vs. Superior Plus Corp | AGRICUL BK vs. SIVERS SEMICONDUCTORS AB |
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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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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