Correlation Between MGIC INVESTMENT and AGNC INVESTMENT
Can any of the company-specific risk be diversified away by investing in both MGIC INVESTMENT and AGNC INVESTMENT 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 MGIC INVESTMENT and AGNC INVESTMENT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MGIC INVESTMENT and AGNC INVESTMENT, you can compare the effects of market volatilities on MGIC INVESTMENT and AGNC INVESTMENT 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 MGIC INVESTMENT with a short position of AGNC INVESTMENT. Check out your portfolio center. Please also check ongoing floating volatility patterns of MGIC INVESTMENT and AGNC INVESTMENT.
Diversification Opportunities for MGIC INVESTMENT and AGNC INVESTMENT
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between MGIC and AGNC is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding MGIC INVESTMENT and AGNC INVESTMENT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AGNC INVESTMENT and MGIC INVESTMENT 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 MGIC INVESTMENT are associated (or correlated) with AGNC INVESTMENT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AGNC INVESTMENT has no effect on the direction of MGIC INVESTMENT i.e., MGIC INVESTMENT and AGNC INVESTMENT go up and down completely randomly.
Pair Corralation between MGIC INVESTMENT and AGNC INVESTMENT
Assuming the 90 days trading horizon MGIC INVESTMENT is expected to generate 1.23 times less return on investment than AGNC INVESTMENT. In addition to that, MGIC INVESTMENT is 1.58 times more volatile than AGNC INVESTMENT. It trades about 0.07 of its total potential returns per unit of risk. AGNC INVESTMENT is currently generating about 0.13 per unit of volatility. If you would invest 890.00 in AGNC INVESTMENT on September 15, 2024 and sell it today you would earn a total of 20.00 from holding AGNC INVESTMENT or generate 2.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MGIC INVESTMENT vs. AGNC INVESTMENT
Performance |
| Timeline |
| MGIC INVESTMENT |
| AGNC INVESTMENT |
MGIC INVESTMENT and AGNC INVESTMENT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MGIC INVESTMENT and AGNC INVESTMENT
The main advantage of trading using opposite MGIC INVESTMENT and AGNC INVESTMENT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MGIC INVESTMENT position performs unexpectedly, AGNC INVESTMENT 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 AGNC INVESTMENT will offset losses from the drop in AGNC INVESTMENT's long position.| MGIC INVESTMENT vs. Sterling Construction | MGIC INVESTMENT vs. Singapore Reinsurance | MGIC INVESTMENT vs. REVO INSURANCE SPA | MGIC INVESTMENT vs. Universal Insurance Holdings |
| AGNC INVESTMENT vs. PKSHA TECHNOLOGY INC | AGNC INVESTMENT vs. Wayside Technology Group | AGNC INVESTMENT vs. ATOSS SOFTWARE | AGNC INVESTMENT vs. Sunny Optical Technology |
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..
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