Correlation Between NetSol Technologies and AGP

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

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

Diversification Opportunities for NetSol Technologies and AGP

0.0

Correlation Coefficient

NetSol Technologies  AGP

Pay attention - limited upside

The 3 months correlation between NetSol and AGP is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding NetSol Technologies and AGP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AGP and NetSol Technologies 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 NetSol Technologies are associated (or correlated) with AGP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AGP has no effect on the direction of NetSol Technologies i.e., NetSol Technologies and AGP go up and down completely randomly.

Pair Corralation between NetSol Technologies and AGP

If you would invest (100.00) in AGP on December 22, 2024 and sell it today you would earn a total of  100.00  from holding AGP or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

NetSol Technologies  vs.  AGP

NetSol Technologies

Risk-Adjusted Performance

Very Weak

Over the last 90 days NetSol Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

AGP

Risk-Adjusted Performance

Very Weak

Over the last 90 days AGP has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, AGP is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with NetSol Technologies and AGP

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

The idea behind NetSol Technologies and AGP 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.

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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.