Correlation Between TNB and AGVC

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both TNB and AGVC 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 TNB and AGVC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TNB and AGVC, you can compare the effects of market volatilities on TNB and AGVC 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 TNB with a short position of AGVC. Check out your portfolio center. Please also check ongoing floating volatility patterns of TNB and AGVC.

Diversification Opportunities for TNB and AGVC

-0.9
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between TNB and AGVC is -0.9. Overlapping area represents the amount of risk that can be diversified away by holding TNB and AGVC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AGVC and TNB 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 TNB are associated (or correlated) with AGVC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AGVC has no effect on the direction of TNB i.e., TNB and AGVC go up and down completely randomly.

Pair Corralation between TNB and AGVC

Assuming the 90 days trading horizon TNB is expected to generate 10.92 times more return on investment than AGVC. However, TNB is 10.92 times more volatile than AGVC. It trades about 0.03 of its potential returns per unit of risk. AGVC is currently generating about 0.01 per unit of risk. If you would invest  0.45  in TNB on December 29, 2023 and sell it today you would lose (0.45) from holding TNB or give up 98.63% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthSignificant
Accuracy72.4%
ValuesDaily Returns

TNB  vs.  AGVC

 Performance 
       Timeline  
TNB 

Risk-Adjusted Performance

18 of 100

 
Low
 
High
Solid
Compared to the overall equity markets, risk-adjusted returns on investments in TNB are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady fundamental drivers, TNB exhibited solid returns over the last few months and may actually be approaching a breakup point.
AGVC 

Risk-Adjusted Performance

0 of 100

 
Low
 
High
Very Weak
Over the last 90 days AGVC has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, AGVC is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

TNB and AGVC Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with TNB and AGVC

The main advantage of trading using opposite TNB and AGVC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TNB position performs unexpectedly, AGVC 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 AGVC will offset losses from the drop in AGVC's long position.
The idea behind TNB and AGVC 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.

Other Complementary Tools

AI Investment Finder
Use AI to screen and filter profitable investment opportunities
Equity Search
Search for actively traded equities including funds and ETFs from over 30 global markets
Portfolio Anywhere
Track or share privately all of your investments from the convenience of any device
Investing Opportunities
Build portfolios using our predefined set of ideas and optimize them against your investing preferences
Analyst Advice
Analyst recommendations and target price estimates broken down by several categories
Stocks Directory
Find actively traded stocks across global markets
Content Syndication
Quickly integrate customizable finance content to your own investment portal
Odds Of Bankruptcy
Get analysis of equity chance of financial distress in the next 2 years
Instant Ratings
Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance
Share Portfolio
Track or share privately all of your investments from the convenience of any device
Money Flow Index
Determine momentum by analyzing Money Flow Index and other technical indicators