Correlation Between LUXOR-B and Agillic AS

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

By analyzing existing cross correlation between Investeringsselskabet Luxor AS and Agillic AS, you can compare the effects of market volatilities on LUXOR-B and Agillic AS 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 LUXOR-B with a short position of Agillic AS. Check out your portfolio center. Please also check ongoing floating volatility patterns of LUXOR-B and Agillic AS.

Diversification Opportunities for LUXOR-B and Agillic AS

-0.18

Correlation Coefficient

LUXOR-B  Agillic AS

Good diversification

The 3 months correlation between LUXOR-B and Agillic is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Investeringsselskabet Luxor AS and Agillic AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Agillic AS and LUXOR-B 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 Investeringsselskabet Luxor AS are associated (or correlated) with Agillic AS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Agillic AS has no effect on the direction of LUXOR-B i.e., LUXOR-B and Agillic AS go up and down completely randomly.

Pair Corralation between LUXOR-B and Agillic AS

Assuming the 90 days trading horizon Investeringsselskabet Luxor AS is expected to generate 0.92 times more return on investment than Agillic AS. However, Investeringsselskabet Luxor AS is 1.08 times less risky than Agillic AS. It trades about 0.04 of its potential returns per unit of risk. Agillic AS is currently generating about -0.11 per unit of risk. If you would invest  63,000  in Investeringsselskabet Luxor AS on October 8, 2024 and sell it today you would earn a total of  8,500  from holding Investeringsselskabet Luxor AS or generate 13.49% return on investment over 90 days.

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

Investeringsselskabet Luxor AS  vs.  Agillic AS

Investeringsselskabet

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Investeringsselskabet Luxor AS are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unfluctuating basic indicators, LUXOR-B sustained solid returns over the last few months and may actually be approaching a breakup point.

Agillic AS

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Agillic AS has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unfluctuating performance, the Stock's fundamental indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Pair Trading with LUXOR-B and Agillic AS

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

The idea behind Investeringsselskabet Luxor AS and Agillic AS 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .