Correlation Between AGNC Investment and Commercial Bancshares
Can any of the company-specific risk be diversified away by investing in both AGNC Investment and Commercial Bancshares 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 AGNC Investment and Commercial Bancshares into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AGNC Investment Corp and Commercial Bancshares OH, you can compare the effects of market volatilities on AGNC Investment and Commercial Bancshares 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 AGNC Investment with a short position of Commercial Bancshares. Check out your portfolio center. Please also check ongoing floating volatility patterns of AGNC Investment and Commercial Bancshares.
Diversification Opportunities for AGNC Investment and Commercial Bancshares
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between AGNC and Commercial is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding AGNC Investment Corp and Commercial Bancshares OH in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Commercial Bancshares and AGNC Investment 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 AGNC Investment Corp are associated (or correlated) with Commercial Bancshares. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Commercial Bancshares has no effect on the direction of AGNC Investment i.e., AGNC Investment and Commercial Bancshares go up and down completely randomly.
Pair Corralation between AGNC Investment and Commercial Bancshares
If you would invest (100.00) in Commercial Bancshares OH on January 20, 2024 and sell it today you would earn a total of 100.00 from holding Commercial Bancshares OH 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 |
AGNC Investment Corp vs. Commercial Bancshares OH
Performance |
Timeline |
AGNC Investment Corp |
Commercial Bancshares |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
AGNC Investment and Commercial Bancshares Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with AGNC Investment and Commercial Bancshares
The main advantage of trading using opposite AGNC Investment and Commercial Bancshares positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AGNC Investment position performs unexpectedly, Commercial Bancshares 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 Commercial Bancshares will offset losses from the drop in Commercial Bancshares' long position.The idea behind AGNC Investment Corp and Commercial Bancshares OH 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.Commercial Bancshares vs. NETGEAR | Commercial Bancshares vs. Arrow Electronics | Commercial Bancshares vs. KNOT Offshore Partners | Commercial Bancshares vs. Amkor Technology |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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