Correlation Between Tutor Perini and Agrify Corp

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

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

Diversification Opportunities for Tutor Perini and Agrify Corp

0.31

Correlation Coefficient

Tutor Perini  Agrify Corp

Weak diversification

The 3 months correlation between Tutor and Agrify is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Tutor Perini and Agrify Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Agrify Corp and Tutor Perini 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 Tutor Perini are associated (or correlated) with Agrify Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Agrify Corp has no effect on the direction of Tutor Perini i.e., Tutor Perini and Agrify Corp go up and down completely randomly.

Pair Corralation between Tutor Perini and Agrify Corp

Considering the 90-day investment horizon Tutor Perini is expected to generate 14.1 times less return on investment than Agrify Corp. But when comparing it to its historical volatility, Tutor Perini is 4.51 times less risky than Agrify Corp. It trades about 0.11 of its potential returns per unit of risk. Agrify Corp is currently generating about 0.33 of returns per unit of risk over similar time horizon. If you would invest  354.00  in Agrify Corp on September 2, 2024 and sell it today you would earn a total of  5,321  from holding Agrify Corp or generate 1503.11% return on investment over 90 days.

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

Tutor Perini  vs.  Agrify Corp

Tutor Perini

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Tutor Perini are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak basic indicators, Tutor Perini exhibited solid returns over the last few months and may actually be approaching a breakup point.

Agrify Corp

Risk-Adjusted Performance

26 of 100

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Agrify Corp are ranked lower than 26 (%) of all global equities and portfolios over the last 90 days. In spite of fairly fragile technical and fundamental indicators, Agrify Corp showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Tutor Perini and Agrify Corp

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

The idea behind Tutor Perini and Agrify Corp 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.