Correlation Between Wishpond Technologies and AGF Management

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

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

Diversification Opportunities for Wishpond Technologies and AGF Management

0.64

Correlation Coefficient

Wishpond Technologies  AGF Management

Poor diversification

The 3 months correlation between Wishpond and AGF is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Wishpond Technologies and AGF Management Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AGF Management and Wishpond 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 Wishpond Technologies are associated (or correlated) with AGF Management. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AGF Management has no effect on the direction of Wishpond Technologies i.e., Wishpond Technologies and AGF Management go up and down completely randomly.

Pair Corralation between Wishpond Technologies and AGF Management

Assuming the 90 days trading horizon Wishpond Technologies is expected to under-perform the AGF Management. In addition to that, Wishpond Technologies is 1.99 times more volatile than AGF Management Limited. It trades about -0.06 of its total potential returns per unit of risk. AGF Management Limited is currently generating about -0.03 per unit of volatility. If you would invest  1,044  in AGF Management Limited on December 30, 2024 and sell it today you would lose (47.00) from holding AGF Management Limited or give up 4.5% of portfolio value over 90 days.

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

Wishpond Technologies  vs.  AGF Management Limited

Wishpond Technologies

Risk-Adjusted Performance

Very Weak

Over the last 90 days Wishpond Technologies 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 fairly stable which may send shares a bit higher in April 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

AGF Management

Risk-Adjusted Performance

Very Weak

Over the last 90 days AGF Management Limited has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, AGF Management is not utilizing all of its potentials. The recent stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Wishpond Technologies and AGF Management

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

The idea behind Wishpond Technologies and AGF Management Limited 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.