Correlation Between Agile Thrpe and Phibro Animal

Can any of the company-specific risk be diversified away by investing in both Agile Thrpe and Phibro Animal 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 Agile Thrpe and Phibro Animal into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Agile Thrpe and Phibro Animal Health, you can compare the effects of market volatilities on Agile Thrpe and Phibro Animal 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 Agile Thrpe with a short position of Phibro Animal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Agile Thrpe and Phibro Animal.

Diversification Opportunities for Agile Thrpe and Phibro Animal

-0.78

Correlation Coefficient

Agile Thrpe  Phibro Animal

Pay attention - limited upside

The 3 months correlation between Agile and Phibro is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding Agile Thrpe and Phibro Animal Health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Phibro Animal Health and Agile Thrpe 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 Agile Thrpe are associated (or correlated) with Phibro Animal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Phibro Animal Health has no effect on the direction of Agile Thrpe i.e., Agile Thrpe and Phibro Animal go up and down completely randomly.

Pair Corralation between Agile Thrpe and Phibro Animal

If you would invest  2,110  in Phibro Animal Health on September 12, 2024 and sell it today you would earn a total of  286.00  from holding Phibro Animal Health or generate 13.55% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	1.56%
Values	Daily Returns

Agile Thrpe  vs.  Phibro Animal Health

Agile Thrpe

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Agile Thrpe has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, Agile Thrpe is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

Phibro Animal Health

Risk-Adjusted Performance

8 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Phibro Animal Health are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of rather conflicting technical indicators, Phibro Animal exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Agile Thrpe and Phibro Animal

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

The idea behind Agile Thrpe and Phibro Animal Health 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.