Correlation Between Insteel Industries and AGF Management
Can any of the company-specific risk be diversified away by investing in both Insteel Industries and AGF Management 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 Insteel Industries and AGF Management into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Insteel Industries and AGF Management Limited, you can compare the effects of market volatilities on Insteel Industries and AGF Management 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 Insteel Industries with a short position of AGF Management. Check out your portfolio center. Please also check ongoing floating volatility patterns of Insteel Industries and AGF Management.
Diversification Opportunities for Insteel Industries and AGF Management
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Insteel and AGF is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Insteel Industries and AGF Management Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AGF Management and Insteel Industries 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 Insteel Industries are associated (or correlated) with AGF Management. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AGF Management has no effect on the direction of Insteel Industries i.e., Insteel Industries and AGF Management go up and down completely randomly.
Pair Corralation between Insteel Industries and AGF Management
If you would invest 2,480 in Insteel Industries on November 8, 2024 and sell it today you would earn a total of 240.00 from holding Insteel Industries or generate 9.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 9.09% |
| Values | Daily Returns |
Insteel Industries vs. AGF Management Limited
Performance |
| Timeline |
| Insteel Industries |
| AGF Management |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Insteel Industries and AGF Management Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Insteel Industries and AGF Management
The main advantage of trading using opposite Insteel Industries and AGF Management positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Insteel Industries position performs unexpectedly, AGF Management 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 AGF Management will offset losses from the drop in AGF Management's long position.| Insteel Industries vs. Allegheny Technologies Incorporated | Insteel Industries vs. China International Marine | Insteel Industries vs. thyssenkrupp AG | Insteel Industries vs. thyssenkrupp AG |
| AGF Management vs. FIREWEED METALS P | AGF Management vs. DISTRICT METALS | AGF Management vs. MAGNUM MINING EXP | AGF Management vs. Canon Marketing Japan |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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