Correlation Between American Vanguard and Rogers

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

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

Diversification Opportunities for American Vanguard and Rogers

0.01

Correlation Coefficient

American Vanguard  Rogers

Significant diversification

The 3 months correlation between American and Rogers is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding American Vanguard and Rogers in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rogers and American Vanguard 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 American Vanguard are associated (or correlated) with Rogers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rogers has no effect on the direction of American Vanguard i.e., American Vanguard and Rogers go up and down completely randomly.

Pair Corralation between American Vanguard and Rogers

Considering the 90-day investment horizon American Vanguard is expected to generate 1.48 times more return on investment than Rogers. However, American Vanguard is 1.48 times more volatile than Rogers. It trades about 0.07 of its potential returns per unit of risk. Rogers is currently generating about -0.2 per unit of risk. If you would invest  444.00  in American Vanguard on December 20, 2024 and sell it today you would earn a total of  55.00  from holding American Vanguard or generate 12.39% return on investment over 90 days.

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

American Vanguard  vs.  Rogers

American Vanguard

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in American Vanguard are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile basic indicators, American Vanguard exhibited solid returns over the last few months and may actually be approaching a breakup point.

Rogers

Risk-Adjusted Performance

Very Weak

Over the last 90 days Rogers has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with American Vanguard and Rogers

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

The idea behind American Vanguard and Rogers 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.