Correlation Between Morguard Real and Ag Growth

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

By analyzing existing cross correlation between Morguard Real Estate and Ag Growth International, you can compare the effects of market volatilities on Morguard Real and Ag Growth 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 Morguard Real with a short position of Ag Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Morguard Real and Ag Growth.

Diversification Opportunities for Morguard Real and Ag Growth

-0.66

Correlation Coefficient

Morguard Real  Ag Growth

Excellent diversification

The 3 months correlation between Morguard and AFN is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Morguard Real Estate and Ag Growth International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ag Growth International and Morguard Real 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 Morguard Real Estate are associated (or correlated) with Ag Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ag Growth International has no effect on the direction of Morguard Real i.e., Morguard Real and Ag Growth go up and down completely randomly.

Pair Corralation between Morguard Real and Ag Growth

Assuming the 90 days trading horizon Morguard Real Estate is expected to generate 0.36 times more return on investment than Ag Growth. However, Morguard Real Estate is 2.81 times less risky than Ag Growth. It trades about 0.05 of its potential returns per unit of risk. Ag Growth International is currently generating about -0.24 per unit of risk. If you would invest  539.00  in Morguard Real Estate on December 30, 2024 and sell it today you would earn a total of  14.00  from holding Morguard Real Estate or generate 2.6% return on investment over 90 days.

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

Morguard Real Estate  vs.  Ag Growth International

Morguard Real Estate

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Morguard Real Estate are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Morguard Real is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Ag Growth International

Risk-Adjusted Performance

Very Weak

Over the last 90 days Ag Growth International has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with Morguard Real and Ag Growth

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

The idea behind Morguard Real Estate and Ag Growth International 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 Stocks Directory module to find actively traded stocks across global markets.