Correlation Between AGM Group and Pure Storage

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

By analyzing existing cross correlation between AGM Group Holdings and Pure Storage, you can compare the effects of market volatilities on AGM Group and Pure Storage 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 AGM Group with a short position of Pure Storage. Check out your portfolio center. Please also check ongoing floating volatility patterns of AGM Group and Pure Storage.

Diversification Opportunities for AGM Group and Pure Storage

-0.41

Correlation Coefficient

AGM Group  Pure Storage

Very good diversification

The 3 months correlation between AGM and Pure is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding AGM Group Holdings and Pure Storage in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pure Storage and AGM 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 AGM Group Holdings are associated (or correlated) with Pure Storage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pure Storage has no effect on the direction of AGM Group i.e., AGM Group and Pure Storage go up and down completely randomly.

Pair Corralation between AGM Group and Pure Storage

Given the investment horizon of 90 days AGM Group Holdings is expected to generate 1.91 times more return on investment than Pure Storage. However, AGM Group is 1.91 times more volatile than Pure Storage. It trades about 0.13 of its potential returns per unit of risk. Pure Storage is currently generating about 0.01 per unit of risk. If you would invest  55.00  in AGM Group Holdings on September 29, 2024 and sell it today you would earn a total of  70.00  from holding AGM Group Holdings or generate 127.27% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

AGM Group Holdings  vs.  Pure Storage

AGM Group Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days AGM Group Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite inconsistent performance in the last few months, the Stock's primary indicators remain fairly strong which may send shares a bit higher in January 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Pure Storage

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Pure Storage are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak basic indicators, Pure Storage reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with AGM Group and Pure Storage

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

The idea behind AGM Group Holdings and Pure Storage 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 Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..