Correlation Between COLUMBIA SPORTSWEAR and AGR GROUP

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

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

Diversification Opportunities for COLUMBIA SPORTSWEAR and AGR GROUP

0.77

Correlation Coefficient

COLUMBIA SPORTSWEAR  AGR GROUP

Poor diversification

The 3 months correlation between COLUMBIA and AGR is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding COLUMBIA SPORTSWEAR and AGR GROUP A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AGR GROUP A and COLUMBIA SPORTSWEAR 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 COLUMBIA SPORTSWEAR are associated (or correlated) with AGR GROUP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AGR GROUP A has no effect on the direction of COLUMBIA SPORTSWEAR i.e., COLUMBIA SPORTSWEAR and AGR GROUP go up and down completely randomly.

Pair Corralation between COLUMBIA SPORTSWEAR and AGR GROUP

Assuming the 90 days trading horizon COLUMBIA SPORTSWEAR is expected to generate 0.52 times more return on investment than AGR GROUP. However, COLUMBIA SPORTSWEAR is 1.94 times less risky than AGR GROUP. It trades about -0.25 of its potential returns per unit of risk. AGR GROUP A is currently generating about -0.14 per unit of risk. If you would invest  8,350  in COLUMBIA SPORTSWEAR on October 10, 2024 and sell it today you would lose (350.00) from holding COLUMBIA SPORTSWEAR or give up 4.19% of portfolio value over 90 days.

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

COLUMBIA SPORTSWEAR  vs.  AGR GROUP A

COLUMBIA SPORTSWEAR

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in COLUMBIA SPORTSWEAR are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, COLUMBIA SPORTSWEAR may actually be approaching a critical reversion point that can send shares even higher in February 2025.

AGR GROUP A

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in AGR GROUP A are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound technical and fundamental indicators, AGR GROUP is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with COLUMBIA SPORTSWEAR and AGR GROUP

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

The idea behind COLUMBIA SPORTSWEAR and AGR GROUP A 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 Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.