Correlation Between Amatheon Agri and Agrogeneration

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

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

Diversification Opportunities for Amatheon Agri and Agrogeneration

0.48

Correlation Coefficient

Amatheon Agri  Agrogeneration

Very weak diversification

The 3 months correlation between Amatheon and Agrogeneration is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Amatheon Agri Holding and Agrogeneration in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Agrogeneration and Amatheon Agri 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 Amatheon Agri Holding are associated (or correlated) with Agrogeneration. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Agrogeneration has no effect on the direction of Amatheon Agri i.e., Amatheon Agri and Agrogeneration go up and down completely randomly.

Pair Corralation between Amatheon Agri and Agrogeneration

Assuming the 90 days trading horizon Amatheon Agri is expected to generate 1.51 times less return on investment than Agrogeneration. In addition to that, Amatheon Agri is 1.51 times more volatile than Agrogeneration. It trades about 0.01 of its total potential returns per unit of risk. Agrogeneration is currently generating about 0.02 per unit of volatility. If you would invest  8.30  in Agrogeneration on September 22, 2024 and sell it today you would lose (2.36) from holding Agrogeneration or give up 28.43% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	99.8%
Values	Daily Returns

Amatheon Agri Holding  vs.  Agrogeneration

Amatheon Agri Holding

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Amatheon Agri Holding has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest weak performance, the Stock's basic indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Agrogeneration

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Agrogeneration are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Agrogeneration may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Amatheon Agri and Agrogeneration

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

The idea behind Amatheon Agri Holding and Agrogeneration 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 Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..