Correlation Between AG Mortgage and East West
Can any of the company-specific risk be diversified away by investing in both AG Mortgage and East West 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 AG Mortgage and East West into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AG Mortgage Investment and East West Bancorp, you can compare the effects of market volatilities on AG Mortgage and East West 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 AG Mortgage with a short position of East West. Check out your portfolio center. Please also check ongoing floating volatility patterns of AG Mortgage and East West.
Diversification Opportunities for AG Mortgage and East West
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between MITN and East is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding AG Mortgage Investment and East West Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on East West Bancorp and AG Mortgage 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 AG Mortgage Investment are associated (or correlated) with East West. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of East West Bancorp has no effect on the direction of AG Mortgage i.e., AG Mortgage and East West go up and down completely randomly.
Pair Corralation between AG Mortgage and East West
Given the investment horizon of 90 days AG Mortgage Investment is expected to generate 0.13 times more return on investment than East West. However, AG Mortgage Investment is 7.54 times less risky than East West. It trades about 0.2 of its potential returns per unit of risk. East West Bancorp is currently generating about -0.06 per unit of risk. If you would invest 2,460 in AG Mortgage Investment on December 18, 2024 and sell it today you would earn a total of 60.00 from holding AG Mortgage Investment or generate 2.44% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 98.33% |
Values | Daily Returns |
AG Mortgage Investment vs. East West Bancorp
Performance |
Timeline |
AG Mortgage Investment |
East West Bancorp |
AG Mortgage and East West Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with AG Mortgage and East West
The main advantage of trading using opposite AG Mortgage and East West positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AG Mortgage position performs unexpectedly, East West 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 East West will offset losses from the drop in East West's long position.AG Mortgage vs. WPP PLC ADR | AG Mortgage vs. Dream Finders Homes | AG Mortgage vs. Integral Ad Science | AG Mortgage vs. Emerson Electric |
East West vs. Barclays PLC ADR | East West vs. UBS Group AG | East West vs. ING Group NV | East West vs. Citigroup |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
Other Complementary Tools
Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
Bonds Directory Find actively traded corporate debentures issued by US companies | |
Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities |