Correlation Between TGCC SA and AGMA LAHLOU
Can any of the company-specific risk be diversified away by investing in both TGCC SA and AGMA LAHLOU 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 TGCC SA and AGMA LAHLOU into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TGCC SA and AGMA LAHLOU TAZI, you can compare the effects of market volatilities on TGCC SA and AGMA LAHLOU 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 TGCC SA with a short position of AGMA LAHLOU. Check out your portfolio center. Please also check ongoing floating volatility patterns of TGCC SA and AGMA LAHLOU.
Diversification Opportunities for TGCC SA and AGMA LAHLOU
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between TGCC and AGMA is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding TGCC SA and AGMA LAHLOU TAZI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AGMA LAHLOU TAZI and TGCC SA 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 TGCC SA are associated (or correlated) with AGMA LAHLOU. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AGMA LAHLOU TAZI has no effect on the direction of TGCC SA i.e., TGCC SA and AGMA LAHLOU go up and down completely randomly.
Pair Corralation between TGCC SA and AGMA LAHLOU
Assuming the 90 days trading horizon TGCC SA is expected to generate 31.2 times less return on investment than AGMA LAHLOU. But when comparing it to its historical volatility, TGCC SA is 60.18 times less risky than AGMA LAHLOU. It trades about 0.18 of its potential returns per unit of risk. AGMA LAHLOU TAZI is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 607,000 in AGMA LAHLOU TAZI on September 14, 2024 and sell it today you would earn a total of 41,600 from holding AGMA LAHLOU TAZI or generate 6.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 98.78% |
| Values | Daily Returns |
TGCC SA vs. AGMA LAHLOU TAZI
Performance |
| Timeline |
| TGCC SA |
| AGMA LAHLOU TAZI |
TGCC SA and AGMA LAHLOU Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TGCC SA and AGMA LAHLOU
The main advantage of trading using opposite TGCC SA and AGMA LAHLOU positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TGCC SA position performs unexpectedly, AGMA LAHLOU 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 AGMA LAHLOU will offset losses from the drop in AGMA LAHLOU's long position.The idea behind TGCC SA and AGMA LAHLOU TAZI pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| AGMA LAHLOU vs. MICRODATA | AGMA LAHLOU vs. MAROC LEASING | AGMA LAHLOU vs. BANK OF AFRICA | AGMA LAHLOU vs. CREDIT IMMOBILIER ET |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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