Correlation Between Cricut and AGM Group

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Can any of the company-specific risk be diversified away by investing in both Cricut and AGM Group 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 Cricut and AGM Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cricut Inc and AGM Group Holdings, you can compare the effects of market volatilities on Cricut and AGM Group 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 Cricut with a short position of AGM Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cricut and AGM Group.

Diversification Opportunities for Cricut and AGM Group

0.09
  Correlation Coefficient

Significant diversification

The 3 months correlation between Cricut and AGM is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Cricut Inc and AGM Group Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AGM Group Holdings and Cricut 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 Cricut Inc are associated (or correlated) with AGM Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AGM Group Holdings has no effect on the direction of Cricut i.e., Cricut and AGM Group go up and down completely randomly.

Pair Corralation between Cricut and AGM Group

Given the investment horizon of 90 days Cricut is expected to generate 7.4 times less return on investment than AGM Group. But when comparing it to its historical volatility, Cricut Inc is 1.6 times less risky than AGM Group. It trades about 0.02 of its potential returns per unit of risk. AGM Group Holdings is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest  125.00  in AGM Group Holdings on September 9, 2024 and sell it today you would earn a total of  42.00  from holding AGM Group Holdings or generate 33.6% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Cricut Inc  vs.  AGM Group Holdings

 Performance 
       Timeline  
Cricut Inc 

Risk-Adjusted Performance

1 of 100

 
Weak
 
Strong
Weak
Compared to the overall equity markets, risk-adjusted returns on investments in Cricut Inc are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable fundamental indicators, Cricut is not utilizing all of its potentials. The recent stock price uproar, may contribute to short-horizon losses for the private investors.
AGM Group Holdings 

Risk-Adjusted Performance

8 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in AGM Group Holdings are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite fairly uncertain primary indicators, AGM Group demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Cricut and AGM Group Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Cricut and AGM Group

The main advantage of trading using opposite Cricut and AGM Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cricut position performs unexpectedly, AGM Group 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 AGM Group will offset losses from the drop in AGM Group's long position.
The idea behind Cricut Inc and AGM Group Holdings 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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.

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