Correlation Between Carlyle and AGM Group

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

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

Diversification Opportunities for Carlyle and AGM Group

0.72

Correlation Coefficient

Carlyle  AGM Group

Poor diversification

The 3 months correlation between Carlyle and AGM is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Carlyle Group and AGM Group Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AGM Group Holdings and Carlyle 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 Carlyle Group are associated (or correlated) with AGM Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AGM Group Holdings has no effect on the direction of Carlyle i.e., Carlyle and AGM Group go up and down completely randomly.

Pair Corralation between Carlyle and AGM Group

Allowing for the 90-day total investment horizon Carlyle Group is expected to generate 0.13 times more return on investment than AGM Group. However, Carlyle Group is 7.68 times less risky than AGM Group. It trades about -0.04 of its potential returns per unit of risk. AGM Group Holdings is currently generating about -0.14 per unit of risk. If you would invest  5,053  in Carlyle Group on December 27, 2024 and sell it today you would lose (441.00) from holding Carlyle Group or give up 8.73% of portfolio value over 90 days.

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

Carlyle Group  vs.  AGM Group Holdings

Carlyle Group

Risk-Adjusted Performance

Very Weak

Over the last 90 days Carlyle Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest abnormal performance, the Stock's technical and fundamental indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

AGM Group Holdings

Risk-Adjusted Performance

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 uncertain performance in the last few months, the Stock's primary indicators remain fairly strong which may send shares a bit higher in April 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Pair Trading with Carlyle and AGM Group

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

The idea behind Carlyle Group and AGM Group Holdings 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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.