Correlation Between EBullion and AGBA Acquisition

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

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

Diversification Opportunities for EBullion and AGBA Acquisition

0.49

Correlation Coefficient

EBullion  AGBA Acquisition

Very weak diversification

The 3 months correlation between EBullion and AGBA is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding EBullion and AGBA Acquisition Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AGBA Acquisition and EBullion 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 EBullion are associated (or correlated) with AGBA Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AGBA Acquisition has no effect on the direction of EBullion i.e., EBullion and AGBA Acquisition go up and down completely randomly.

Pair Corralation between EBullion and AGBA Acquisition

If you would invest  22.00  in AGBA Acquisition Limited on September 12, 2024 and sell it today you would lose (1.00) from holding AGBA Acquisition Limited or give up 4.55% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	3.85%
Values	Daily Returns

EBullion  vs.  AGBA Acquisition Limited

EBullion

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days EBullion has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent primary indicators, EBullion is not utilizing all of its potentials. The current stock price mess, may contribute to short-term losses for the institutional investors.

AGBA Acquisition

Risk-Adjusted Performance

0 of 100

Weak

Over the last 90 days AGBA Acquisition Limited has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly weak basic indicators, AGBA Acquisition showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with EBullion and AGBA Acquisition

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

The idea behind EBullion and AGBA Acquisition 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.