Correlation Between Ag Growth and Arcane Crypto

Can any of the company-specific risk be diversified away by investing in both Ag Growth and Arcane Crypto 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 Ag Growth and Arcane Crypto into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Ag Growth International and Arcane Crypto AB, you can compare the effects of market volatilities on Ag Growth and Arcane Crypto 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 Ag Growth with a short position of Arcane Crypto. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ag Growth and Arcane Crypto.

Diversification Opportunities for Ag Growth and Arcane Crypto

-0.08

Correlation Coefficient

Ag Growth  Arcane Crypto

Good diversification

The 3 months correlation between AGGZF and Arcane is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Ag Growth International and Arcane Crypto AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Arcane Crypto AB and Ag Growth 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 Ag Growth International are associated (or correlated) with Arcane Crypto. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Arcane Crypto AB has no effect on the direction of Ag Growth i.e., Ag Growth and Arcane Crypto go up and down completely randomly.

Pair Corralation between Ag Growth and Arcane Crypto

Assuming the 90 days horizon Ag Growth International is expected to generate 0.16 times more return on investment than Arcane Crypto. However, Ag Growth International is 6.22 times less risky than Arcane Crypto. It trades about -0.03 of its potential returns per unit of risk. Arcane Crypto AB is currently generating about -0.13 per unit of risk. If you would invest  4,080  in Ag Growth International on September 12, 2024 and sell it today you would lose (172.00) from holding Ag Growth International or give up 4.22% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.41%
Values	Daily Returns

Ag Growth International  vs.  Arcane Crypto AB

Ag Growth International

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ag Growth International has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Ag Growth is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Arcane Crypto AB

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Arcane Crypto AB has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Ag Growth and Arcane Crypto

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

The idea behind Ag Growth International and Arcane Crypto AB 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.