Correlation Between Starfleet Innotech and AGF Management
Can any of the company-specific risk be diversified away by investing in both Starfleet Innotech 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 Starfleet Innotech and AGF Management into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Starfleet Innotech and AGF Management Limited, you can compare the effects of market volatilities on Starfleet Innotech 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 Starfleet Innotech with a short position of AGF Management. Check out your portfolio center. Please also check ongoing floating volatility patterns of Starfleet Innotech and AGF Management.
Diversification Opportunities for Starfleet Innotech and AGF Management
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Starfleet and AGF is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Starfleet Innotech and AGF Management Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AGF Management and Starfleet Innotech 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 Starfleet Innotech 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 Starfleet Innotech i.e., Starfleet Innotech and AGF Management go up and down completely randomly.
Pair Corralation between Starfleet Innotech and AGF Management
Given the investment horizon of 90 days Starfleet Innotech is expected to generate 13.15 times more return on investment than AGF Management. However, Starfleet Innotech is 13.15 times more volatile than AGF Management Limited. It trades about 0.24 of its potential returns per unit of risk. AGF Management Limited is currently generating about 0.19 per unit of risk. If you would invest 0.19 in Starfleet Innotech on August 28, 2024 and sell it today you would earn a total of 0.17 from holding Starfleet Innotech or generate 89.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Starfleet Innotech vs. AGF Management Limited
Performance |
| Timeline |
| Starfleet Innotech |
| AGF Management |
Starfleet Innotech and AGF Management Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Starfleet Innotech and AGF Management
The main advantage of trading using opposite Starfleet Innotech and AGF Management positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Starfleet Innotech 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.| Starfleet Innotech vs. Blackstone Group | Starfleet Innotech vs. BlackRock | Starfleet Innotech vs. Apollo Global Management | Starfleet Innotech vs. Bank of New |
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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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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