Correlation Between ACCSYS TECHPLC and Agilent Technologies

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

By analyzing existing cross correlation between ACCSYS TECHPLC EO and Agilent Technologies, you can compare the effects of market volatilities on ACCSYS TECHPLC and Agilent Technologies 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 ACCSYS TECHPLC with a short position of Agilent Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of ACCSYS TECHPLC and Agilent Technologies.

Diversification Opportunities for ACCSYS TECHPLC and Agilent Technologies

0.07

Correlation Coefficient

ACCSYS TECHPLC  Agilent Technologies

Significant diversification

The 3 months correlation between ACCSYS and Agilent is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding ACCSYS TECHPLC EO and Agilent Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Agilent Technologies and ACCSYS TECHPLC 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 ACCSYS TECHPLC EO are associated (or correlated) with Agilent Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Agilent Technologies has no effect on the direction of ACCSYS TECHPLC i.e., ACCSYS TECHPLC and Agilent Technologies go up and down completely randomly.

Pair Corralation between ACCSYS TECHPLC and Agilent Technologies

Assuming the 90 days horizon ACCSYS TECHPLC EO is expected to under-perform the Agilent Technologies. In addition to that, ACCSYS TECHPLC is 1.31 times more volatile than Agilent Technologies. It trades about -0.03 of its total potential returns per unit of risk. Agilent Technologies is currently generating about 0.04 per unit of volatility. If you would invest  11,673  in Agilent Technologies on October 9, 2024 and sell it today you would earn a total of  1,403  from holding Agilent Technologies or generate 12.02% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

ACCSYS TECHPLC EO  vs.  Agilent Technologies

ACCSYS TECHPLC EO

Risk-Adjusted Performance

0 of 100

Very Weak

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

Agilent Technologies

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with ACCSYS TECHPLC and Agilent Technologies

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

The idea behind ACCSYS TECHPLC EO and Agilent Technologies 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.