Correlation Between AGRICUL BK and Varta AG
Can any of the company-specific risk be diversified away by investing in both AGRICUL BK and Varta AG 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 Varta AG 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 Varta AG, you can compare the effects of market volatilities on AGRICUL BK and Varta AG 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 Varta AG. Check out your portfolio center. Please also check ongoing floating volatility patterns of AGRICUL BK and Varta AG.
Diversification Opportunities for AGRICUL BK and Varta AG
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between AGRICUL and Varta is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding AGRICUL BK CHINA H and Varta AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Varta AG 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 Varta AG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Varta AG has no effect on the direction of AGRICUL BK i.e., AGRICUL BK and Varta AG go up and down completely randomly.
Pair Corralation between AGRICUL BK and Varta AG
Assuming the 90 days trading horizon AGRICUL BK CHINA H is expected to generate 0.31 times more return on investment than Varta AG. However, AGRICUL BK CHINA H is 3.21 times less risky than Varta AG. It trades about 0.01 of its potential returns per unit of risk. Varta AG is currently generating about -0.27 per unit of risk. If you would invest 46.00 in AGRICUL BK CHINA H on August 28, 2024 and sell it today you would earn a total of 0.00 from holding AGRICUL BK CHINA H or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AGRICUL BK CHINA H vs. Varta AG
Performance |
| Timeline |
| AGRICUL BK CHINA |
| Varta AG |
AGRICUL BK and Varta AG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AGRICUL BK and Varta AG
The main advantage of trading using opposite AGRICUL BK and Varta AG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AGRICUL BK position performs unexpectedly, Varta AG 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 Varta AG will offset losses from the drop in Varta AG's long position.| AGRICUL BK vs. ACCSYS TECHPLC EO | AGRICUL BK vs. Wyndham Hotels Resorts | AGRICUL BK vs. FARO Technologies | AGRICUL BK vs. MHP Hotel AG |
| Varta AG vs. ECHO INVESTMENT ZY | Varta AG vs. PennyMac Mortgage Investment | Varta AG vs. GALENA MINING LTD | Varta AG vs. MGIC INVESTMENT |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
Other Complementary Tools
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope |