Correlation Between AGBA Acquisition and Oshidori International

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

By analyzing existing cross correlation between AGBA Acquisition Limited and Oshidori International Holdings, you can compare the effects of market volatilities on AGBA Acquisition and Oshidori International 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 AGBA Acquisition with a short position of Oshidori International. Check out your portfolio center. Please also check ongoing floating volatility patterns of AGBA Acquisition and Oshidori International.

Diversification Opportunities for AGBA Acquisition and Oshidori International

0.0

Correlation Coefficient

AGBA Acquisition  Oshidori International

Pay attention - limited upside

The 3 months correlation between AGBA and Oshidori is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding AGBA Acquisition Limited and Oshidori International Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oshidori International and AGBA Acquisition 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 AGBA Acquisition Limited are associated (or correlated) with Oshidori International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oshidori International has no effect on the direction of AGBA Acquisition i.e., AGBA Acquisition and Oshidori International go up and down completely randomly.

Pair Corralation between AGBA Acquisition and Oshidori International

Assuming the 90 days horizon AGBA Acquisition Limited is expected to generate 84.08 times more return on investment than Oshidori International. However, AGBA Acquisition is 84.08 times more volatile than Oshidori International Holdings. It trades about 0.12 of its potential returns per unit of risk. Oshidori International Holdings is currently generating about 0.04 per unit of risk. If you would invest  1.50  in AGBA Acquisition Limited on July 15, 2024 and sell it today you would earn a total of  17.50  from holding AGBA Acquisition Limited or generate 1166.67% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	77.82%
Values	Daily Returns

AGBA Acquisition Limited  vs.  Oshidori International Holding

AGBA Acquisition

Risk-Adjusted Performance

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Weak

Compared to the overall equity markets, risk-adjusted returns on investments in AGBA Acquisition Limited are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, AGBA Acquisition may actually be approaching a critical reversion point that can send shares even higher in November 2024.

Oshidori International

Risk-Adjusted Performance

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Very Weak

Over the last 90 days Oshidori International Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable fundamental indicators, Oshidori International is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with AGBA Acquisition and Oshidori International

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

The idea behind AGBA Acquisition Limited and Oshidori International Holdings 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.