Correlation Between First Graphene and AGC
Can any of the company-specific risk be diversified away by investing in both First Graphene and AGC 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 First Graphene and AGC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Graphene and AGC Inc ADR, you can compare the effects of market volatilities on First Graphene and AGC 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 First Graphene with a short position of AGC. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Graphene and AGC.
Diversification Opportunities for First Graphene and AGC
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between First and AGC is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding First Graphene and AGC Inc ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AGC Inc ADR and First Graphene 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 First Graphene are associated (or correlated) with AGC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AGC Inc ADR has no effect on the direction of First Graphene i.e., First Graphene and AGC go up and down completely randomly.
Pair Corralation between First Graphene and AGC
Assuming the 90 days horizon First Graphene is expected to generate 5.63 times more return on investment than AGC. However, First Graphene is 5.63 times more volatile than AGC Inc ADR. It trades about 0.04 of its potential returns per unit of risk. AGC Inc ADR is currently generating about 0.0 per unit of risk. If you would invest 6.00 in First Graphene on August 31, 2024 and sell it today you would lose (3.90) from holding First Graphene or give up 65.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.73% |
| Values | Daily Returns |
First Graphene vs. AGC Inc ADR
Performance |
| Timeline |
| First Graphene |
| AGC Inc ADR |
First Graphene and AGC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Graphene and AGC
The main advantage of trading using opposite First Graphene and AGC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Graphene position performs unexpectedly, AGC 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 AGC will offset losses from the drop in AGC's long position.| First Graphene vs. Haydale Graphene Industries | First Graphene vs. Versarien plc | First Graphene vs. NanoXplore | First Graphene vs. G6 Materials Corp |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
Other Complementary Tools
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Global Correlations Find global opportunities by holding instruments from different markets |