Correlation Between Agroliga Group and True Games

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

By analyzing existing cross correlation between Agroliga Group PLC and True Games Syndicate, you can compare the effects of market volatilities on Agroliga Group and True Games 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 Agroliga Group with a short position of True Games. Check out your portfolio center. Please also check ongoing floating volatility patterns of Agroliga Group and True Games.

Diversification Opportunities for Agroliga Group and True Games

-0.41

Correlation Coefficient

Agroliga Group  True Games

Very good diversification

The 3 months correlation between Agroliga and True is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Agroliga Group PLC and True Games Syndicate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on True Games Syndicate and Agroliga Group 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 Agroliga Group PLC are associated (or correlated) with True Games. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of True Games Syndicate has no effect on the direction of Agroliga Group i.e., Agroliga Group and True Games go up and down completely randomly.

Pair Corralation between Agroliga Group and True Games

Assuming the 90 days trading horizon Agroliga Group PLC is expected to generate 0.9 times more return on investment than True Games. However, Agroliga Group PLC is 1.11 times less risky than True Games. It trades about 0.11 of its potential returns per unit of risk. True Games Syndicate is currently generating about -0.23 per unit of risk. If you would invest  1,820  in Agroliga Group PLC on August 27, 2024 and sell it today you would earn a total of  70.00  from holding Agroliga Group PLC or generate 3.85% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	94.12%
Values	Daily Returns

Agroliga Group PLC  vs.  True Games Syndicate

Agroliga Group PLC

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Agroliga Group PLC are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Agroliga Group reported solid returns over the last few months and may actually be approaching a breakup point.

True Games Syndicate

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days True Games Syndicate has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in December 2024. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with Agroliga Group and True Games

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

The idea behind Agroliga Group PLC and True Games Syndicate 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.