Correlation Between AGFiQ Market and Siren DIVCON

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

By analyzing existing cross correlation between AGFiQ Market Neutral and Siren DIVCON Dividend, you can compare the effects of market volatilities on AGFiQ Market and Siren DIVCON 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 AGFiQ Market with a short position of Siren DIVCON. Check out your portfolio center. Please also check ongoing floating volatility patterns of AGFiQ Market and Siren DIVCON.

Diversification Opportunities for AGFiQ Market and Siren DIVCON

-0.13

Correlation Coefficient

AGFiQ Market  Siren DIVCON

Good diversification

The 3 months correlation between AGFiQ and Siren is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding AGFiQ Market Neutral and Siren DIVCON Dividend in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Siren DIVCON Dividend and AGFiQ Market 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 AGFiQ Market Neutral are associated (or correlated) with Siren DIVCON. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Siren DIVCON Dividend has no effect on the direction of AGFiQ Market i.e., AGFiQ Market and Siren DIVCON go up and down completely randomly.

Pair Corralation between AGFiQ Market and Siren DIVCON

Given the investment horizon of 90 days AGFiQ Market Neutral is expected to under-perform the Siren DIVCON. But the etf apears to be less risky and, when comparing its historical volatility, AGFiQ Market Neutral is 1.6 times less risky than Siren DIVCON. The etf trades about -0.01 of its potential returns per unit of risk. The Siren DIVCON Dividend is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  3,327  in Siren DIVCON Dividend on October 5, 2024 and sell it today you would earn a total of  713.00  from holding Siren DIVCON Dividend or generate 21.43% return on investment over 90 days.

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

AGFiQ Market Neutral  vs.  Siren DIVCON Dividend

AGFiQ Market Neutral

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days AGFiQ Market Neutral has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest conflicting performance, the Etf's basic indicators remain persistent and the latest mess on Wall Street may also be a sign of long-standing gains for the ETF venture institutional investors.

Siren DIVCON Dividend

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Siren DIVCON Dividend has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Siren DIVCON is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with AGFiQ Market and Siren DIVCON

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

The idea behind AGFiQ Market Neutral and Siren DIVCON Dividend 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 Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.