Correlation Between Agroliga Group and Creativeforge Games

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

By analyzing existing cross correlation between Agroliga Group PLC and Creativeforge Games SA, you can compare the effects of market volatilities on Agroliga Group and Creativeforge Games 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 Agroliga Group with a short position of Creativeforge Games. Check out your portfolio center. Please also check ongoing floating volatility patterns of Agroliga Group and Creativeforge Games.

Diversification Opportunities for Agroliga Group and Creativeforge Games

0.06

Correlation Coefficient

Agroliga Group  Creativeforge Games

Significant diversification

The 3 months correlation between Agroliga and Creativeforge is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Agroliga Group PLC and Creativeforge Games SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Creativeforge Games and Agroliga Group 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 Agroliga Group PLC are associated (or correlated) with Creativeforge Games. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Creativeforge Games has no effect on the direction of Agroliga Group i.e., Agroliga Group and Creativeforge Games go up and down completely randomly.

Pair Corralation between Agroliga Group and Creativeforge Games

Assuming the 90 days trading horizon Agroliga Group PLC is expected to generate 2.25 times more return on investment than Creativeforge Games. However, Agroliga Group is 2.25 times more volatile than Creativeforge Games SA. It trades about 0.13 of its potential returns per unit of risk. Creativeforge Games SA is currently generating about -0.02 per unit of risk. If you would invest  2,040  in Agroliga Group PLC on December 2, 2024 and sell it today you would earn a total of  840.00  from holding Agroliga Group PLC or generate 41.18% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	91.53%
Values	Daily Returns

Agroliga Group PLC  vs.  Creativeforge Games SA

Agroliga Group PLC

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Agroliga Group PLC are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Agroliga Group reported solid returns over the last few months and may actually be approaching a breakup point.

Creativeforge Games

Risk-Adjusted Performance

Very Weak

Over the last 90 days Creativeforge Games SA has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Creativeforge Games is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Agroliga Group and Creativeforge Games

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

The idea behind Agroliga Group PLC and Creativeforge Games SA 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.