Correlation Between AdTheorent Holding and AG Mortgage

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

By analyzing existing cross correlation between AdTheorent Holding and AG Mortgage Investment, you can compare the effects of market volatilities on AdTheorent Holding and AG Mortgage 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 AdTheorent Holding with a short position of AG Mortgage. Check out your portfolio center. Please also check ongoing floating volatility patterns of AdTheorent Holding and AG Mortgage.

Diversification Opportunities for AdTheorent Holding and AG Mortgage

-0.27

Correlation Coefficient

AdTheorent Holding  AG Mortgage

Very good diversification

The 3 months correlation between AdTheorent and MITP is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding AdTheorent Holding and AG Mortgage Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AG Mortgage Investment and AdTheorent Holding 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 AdTheorent Holding are associated (or correlated) with AG Mortgage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AG Mortgage Investment has no effect on the direction of AdTheorent Holding i.e., AdTheorent Holding and AG Mortgage go up and down completely randomly.

Pair Corralation between AdTheorent Holding and AG Mortgage

If you would invest  2,481  in AG Mortgage Investment on October 23, 2024 and sell it today you would earn a total of  69.00  from holding AG Mortgage Investment or generate 2.78% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	1.64%
Values	Daily Returns

AdTheorent Holding  vs.  AG Mortgage Investment

AdTheorent Holding

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days AdTheorent Holding has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, AdTheorent Holding is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

AG Mortgage Investment

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in AG Mortgage Investment are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable basic indicators, AG Mortgage is not utilizing all of its potentials. The recent stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with AdTheorent Holding and AG Mortgage

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

The idea behind AdTheorent Holding and AG Mortgage Investment 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.