Correlation Between Westwater Resources and Ag Growth
Can any of the company-specific risk be diversified away by investing in both Westwater Resources and Ag Growth 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 Westwater Resources and Ag Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Westwater Resources and Ag Growth International, you can compare the effects of market volatilities on Westwater Resources and Ag Growth 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 Westwater Resources with a short position of Ag Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Westwater Resources and Ag Growth.
Diversification Opportunities for Westwater Resources and Ag Growth
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Westwater and AGGZF is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Westwater Resources and Ag Growth International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ag Growth International and Westwater Resources 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 Westwater Resources are associated (or correlated) with Ag Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ag Growth International has no effect on the direction of Westwater Resources i.e., Westwater Resources and Ag Growth go up and down completely randomly.
Pair Corralation between Westwater Resources and Ag Growth
Considering the 90-day investment horizon Westwater Resources is expected to generate 3.09 times more return on investment than Ag Growth. However, Westwater Resources is 3.09 times more volatile than Ag Growth International. It trades about 0.22 of its potential returns per unit of risk. Ag Growth International is currently generating about -0.29 per unit of risk. If you would invest 53.00 in Westwater Resources on October 21, 2024 and sell it today you would earn a total of 26.00 from holding Westwater Resources or generate 49.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Westwater Resources vs. Ag Growth International
Performance |
| Timeline |
| Westwater Resources |
| Ag Growth International |
Westwater Resources and Ag Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Westwater Resources and Ag Growth
The main advantage of trading using opposite Westwater Resources and Ag Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Westwater Resources position performs unexpectedly, Ag Growth 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 Ag Growth will offset losses from the drop in Ag Growth's long position.| Westwater Resources vs. Mason Graphite | Westwater Resources vs. Northern Graphite | Westwater Resources vs. Graphite One | Westwater Resources vs. Lomiko Metals |
| Ag Growth vs. First Tractor | Ag Growth vs. AmeraMex International | Ag Growth vs. Arts Way Manufacturing Co | Ag Growth vs. American Premium Water |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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