Correlation Between Cricut and AGM Group

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

0.08

Correlation Coefficient

Cricut  AGM Group

Significant diversification

The 3 months correlation between Cricut and AGM is 0.08. 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 25.9 times less return on investment than AGM Group. But when comparing it to its historical volatility, Cricut Inc is 1.35 times less risky than AGM Group. It trades about 0.0 of its potential returns per unit of risk. AGM Group Holdings is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  202.00  in AGM Group Holdings on September 11, 2024 and sell it today you would lose (28.00) from holding AGM Group Holdings or give up 13.86% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	98.55%
Values	Daily Returns

Cricut Inc  vs.  AGM Group Holdings

Cricut Inc

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Cricut Inc are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain fundamental indicators, Cricut may actually be approaching a critical reversion point that can send shares even higher in January 2025.

AGM Group Holdings

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in AGM Group Holdings are ranked lower than 10 (%) 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.

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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.