Correlation Between AGRICUL BK and Arch Capital
Can any of the company-specific risk be diversified away by investing in both AGRICUL BK and Arch Capital 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 Arch Capital 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 Arch Capital Group, you can compare the effects of market volatilities on AGRICUL BK and Arch Capital 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 Arch Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of AGRICUL BK and Arch Capital.
Diversification Opportunities for AGRICUL BK and Arch Capital
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between AGRICUL and Arch is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding AGRICUL BK CHINA H and Arch Capital Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Arch Capital Group 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 Arch Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Arch Capital Group has no effect on the direction of AGRICUL BK i.e., AGRICUL BK and Arch Capital go up and down completely randomly.
Pair Corralation between AGRICUL BK and Arch Capital
Assuming the 90 days trading horizon AGRICUL BK CHINA H is expected to generate 4.03 times more return on investment than Arch Capital. However, AGRICUL BK is 4.03 times more volatile than Arch Capital Group. It trades about 0.07 of its potential returns per unit of risk. Arch Capital Group is currently generating about 0.06 per unit of risk. If you would invest 14.00 in AGRICUL BK CHINA H on August 26, 2024 and sell it today you would earn a total of 32.00 from holding AGRICUL BK CHINA H or generate 228.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
AGRICUL BK CHINA H vs. Arch Capital Group
Performance |
| Timeline |
| AGRICUL BK CHINA |
| Arch Capital Group |
AGRICUL BK and Arch Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AGRICUL BK and Arch Capital
The main advantage of trading using opposite AGRICUL BK and Arch Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AGRICUL BK position performs unexpectedly, Arch Capital 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 Arch Capital will offset losses from the drop in Arch Capital's long position.| AGRICUL BK vs. Strategic Investments AS | AGRICUL BK vs. Apollo Investment Corp | AGRICUL BK vs. REGAL ASIAN INVESTMENTS | AGRICUL BK vs. HK Electric Investments |
| Arch Capital vs. Evolution Mining Limited | Arch Capital vs. Zijin Mining Group | Arch Capital vs. GALENA MINING LTD | Arch Capital vs. GEAR4MUSIC LS 10 |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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