Correlation Between AGRICULTBK HADR/25 and THRACE PLASTICS
Can any of the company-specific risk be diversified away by investing in both AGRICULTBK HADR/25 and THRACE PLASTICS 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 AGRICULTBK HADR/25 and THRACE PLASTICS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AGRICULTBK HADR25 YC and THRACE PLASTICS, you can compare the effects of market volatilities on AGRICULTBK HADR/25 and THRACE PLASTICS 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 AGRICULTBK HADR/25 with a short position of THRACE PLASTICS. Check out your portfolio center. Please also check ongoing floating volatility patterns of AGRICULTBK HADR/25 and THRACE PLASTICS.
Diversification Opportunities for AGRICULTBK HADR/25 and THRACE PLASTICS
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between AGRICULTBK and THRACE is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding AGRICULTBK HADR25 YC and THRACE PLASTICS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on THRACE PLASTICS and AGRICULTBK HADR/25 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 AGRICULTBK HADR25 YC are associated (or correlated) with THRACE PLASTICS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of THRACE PLASTICS has no effect on the direction of AGRICULTBK HADR/25 i.e., AGRICULTBK HADR/25 and THRACE PLASTICS go up and down completely randomly.
Pair Corralation between AGRICULTBK HADR/25 and THRACE PLASTICS
Assuming the 90 days trading horizon AGRICULTBK HADR25 YC is expected to generate 1.79 times more return on investment than THRACE PLASTICS. However, AGRICULTBK HADR/25 is 1.79 times more volatile than THRACE PLASTICS. It trades about 0.07 of its potential returns per unit of risk. THRACE PLASTICS is currently generating about -0.05 per unit of risk. If you would invest 701.00 in AGRICULTBK HADR25 YC on August 28, 2024 and sell it today you would earn a total of 439.00 from holding AGRICULTBK HADR25 YC or generate 62.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.72% |
| Values | Daily Returns |
AGRICULTBK HADR25 YC vs. THRACE PLASTICS
Performance |
| Timeline |
| AGRICULTBK HADR/25 |
| THRACE PLASTICS |
AGRICULTBK HADR/25 and THRACE PLASTICS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AGRICULTBK HADR/25 and THRACE PLASTICS
The main advantage of trading using opposite AGRICULTBK HADR/25 and THRACE PLASTICS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AGRICULTBK HADR/25 position performs unexpectedly, THRACE PLASTICS 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 THRACE PLASTICS will offset losses from the drop in THRACE PLASTICS's long position.| AGRICULTBK HADR/25 vs. The Toronto Dominion Bank | AGRICULTBK HADR/25 vs. Superior Plus Corp | AGRICULTBK HADR/25 vs. NMI Holdings | AGRICULTBK HADR/25 vs. Origin Agritech |
| THRACE PLASTICS vs. Algonquin Power Utilities | THRACE PLASTICS vs. CARSALESCOM | THRACE PLASTICS vs. PACIFIC ONLINE | THRACE PLASTICS vs. SALESFORCE INC CDR |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
Other Complementary Tools
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm |