Correlation Between AGNC INVESTMENT and HEALTHCARE REAL

Can any of the company-specific risk be diversified away by investing in both AGNC INVESTMENT and HEALTHCARE REAL 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 AGNC INVESTMENT and HEALTHCARE REAL into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between AGNC INVESTMENT and HEALTHCARE REAL A, you can compare the effects of market volatilities on AGNC INVESTMENT and HEALTHCARE REAL 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 AGNC INVESTMENT with a short position of HEALTHCARE REAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of AGNC INVESTMENT and HEALTHCARE REAL.

Diversification Opportunities for AGNC INVESTMENT and HEALTHCARE REAL

0.32

Correlation Coefficient

AGNC INVESTMENT  HEALTHCARE REAL

Weak diversification

The 3 months correlation between AGNC and HEALTHCARE is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding AGNC INVESTMENT and HEALTHCARE REAL A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HEALTHCARE REAL A and AGNC 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 AGNC INVESTMENT are associated (or correlated) with HEALTHCARE REAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HEALTHCARE REAL A has no effect on the direction of AGNC INVESTMENT i.e., AGNC INVESTMENT and HEALTHCARE REAL go up and down completely randomly.

Pair Corralation between AGNC INVESTMENT and HEALTHCARE REAL

Assuming the 90 days trading horizon AGNC INVESTMENT is expected to under-perform the HEALTHCARE REAL. But the stock apears to be less risky and, when comparing its historical volatility, AGNC INVESTMENT is 1.38 times less risky than HEALTHCARE REAL. The stock trades about -0.01 of its potential returns per unit of risk. The HEALTHCARE REAL A is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest  1,590  in HEALTHCARE REAL A on September 28, 2024 and sell it today you would earn a total of  30.00  from holding HEALTHCARE REAL A or generate 1.89% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

AGNC INVESTMENT  vs.  HEALTHCARE REAL A

AGNC INVESTMENT

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days AGNC INVESTMENT has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, AGNC INVESTMENT is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

HEALTHCARE REAL A

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in HEALTHCARE REAL A are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, HEALTHCARE REAL is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with AGNC INVESTMENT and HEALTHCARE REAL

The main advantage of trading using opposite AGNC INVESTMENT and HEALTHCARE REAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AGNC INVESTMENT position performs unexpectedly, HEALTHCARE REAL 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 HEALTHCARE REAL will offset losses from the drop in HEALTHCARE REAL's long position.

The idea behind AGNC INVESTMENT and HEALTHCARE REAL A 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.

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..