Correlation Between Ag Growth and Fortis

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

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

Diversification Opportunities for Ag Growth and Fortis

-0.79

Correlation Coefficient

Ag Growth  Fortis

Pay attention - limited upside

The 3 months correlation between AFN and Fortis is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding Ag Growth International and Fortis Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fortis Inc and Ag Growth 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 Ag Growth International are associated (or correlated) with Fortis. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fortis Inc has no effect on the direction of Ag Growth i.e., Ag Growth and Fortis go up and down completely randomly.

Pair Corralation between Ag Growth and Fortis

Assuming the 90 days trading horizon Ag Growth International is expected to under-perform the Fortis. In addition to that, Ag Growth is 3.35 times more volatile than Fortis Inc. It trades about -0.1 of its total potential returns per unit of risk. Fortis Inc is currently generating about 0.07 per unit of volatility. If you would invest  5,274  in Fortis Inc on March 14, 2024 and sell it today you would earn a total of  182.00  from holding Fortis Inc or generate 3.45% return on investment over 90 days.

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

Ag Growth International  vs.  Fortis Inc

Ag Growth International

Risk-Adjusted Performance

0 of 100

Weak

Over the last 90 days Ag Growth International has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in July 2024. The recent disarray may also be a sign of long period up-swing for the firm investors.

Fortis Inc

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Fortis Inc are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, Fortis is not utilizing all of its potentials. The newest stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Ag Growth and Fortis

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

The idea behind Ag Growth International and Fortis Inc 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.