Correlation Between AGF Management and Andrew Peller

Can any of the company-specific risk be diversified away by investing in both AGF Management and Andrew Peller 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 AGF Management and Andrew Peller into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between AGF Management Limited and Andrew Peller Limited, you can compare the effects of market volatilities on AGF Management and Andrew Peller 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 AGF Management with a short position of Andrew Peller. Check out your portfolio center. Please also check ongoing floating volatility patterns of AGF Management and Andrew Peller.

Diversification Opportunities for AGF Management and Andrew Peller

0.15

Correlation Coefficient

AGF Management  Andrew Peller

Average diversification

The 3 months correlation between AGF and Andrew is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding AGF Management Limited and Andrew Peller Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Andrew Peller Limited and AGF Management 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 AGF Management Limited are associated (or correlated) with Andrew Peller. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Andrew Peller Limited has no effect on the direction of AGF Management i.e., AGF Management and Andrew Peller go up and down completely randomly.

Pair Corralation between AGF Management and Andrew Peller

Assuming the 90 days trading horizon AGF Management Limited is expected to generate 1.54 times more return on investment than Andrew Peller. However, AGF Management is 1.54 times more volatile than Andrew Peller Limited. It trades about 0.18 of its potential returns per unit of risk. Andrew Peller Limited is currently generating about 0.01 per unit of risk. If you would invest  843.00  in AGF Management Limited on September 21, 2024 and sell it today you would earn a total of  213.00  from holding AGF Management Limited or generate 25.27% return on investment over 90 days.

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

AGF Management Limited  vs.  Andrew Peller Limited

AGF Management

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in AGF Management Limited are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unfluctuating basic indicators, AGF Management unveiled solid returns over the last few months and may actually be approaching a breakup point.

Andrew Peller Limited

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with AGF Management and Andrew Peller

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

The idea behind AGF Management Limited and Andrew Peller Limited 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.

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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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.