Correlation Between Netcapital and AGBA Old

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

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

Diversification Opportunities for Netcapital and AGBA Old

-0.55

Correlation Coefficient

Netcapital  AGBA Old

Excellent diversification

The 3 months correlation between Netcapital and AGBA is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Netcapital and AGBA Old in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AGBA Old and Netcapital 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 Netcapital are associated (or correlated) with AGBA Old. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AGBA Old has no effect on the direction of Netcapital i.e., Netcapital and AGBA Old go up and down completely randomly.

Pair Corralation between Netcapital and AGBA Old

If you would invest  560.00  in AGBA Old on October 10, 2024 and sell it today you would earn a total of  0.00  from holding AGBA Old or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	5.0%
Values	Daily Returns

Netcapital  vs.  AGBA Old

Netcapital

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Netcapital are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite quite unsteady basic indicators, Netcapital disclosed solid returns over the last few months and may actually be approaching a breakup point.

AGBA Old

Risk-Adjusted Performance

0 of 100

Market Crasher

Over the last 90 days AGBA Old has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat inconsistent fundamental drivers, AGBA Old sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Netcapital and AGBA Old

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

The idea behind Netcapital and AGBA Old 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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.