Correlation Between AGNC Investment and Kava

Can any of the company-specific risk be diversified away by investing in both AGNC Investment and Kava 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 Kava 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 Kava, you can compare the effects of market volatilities on AGNC Investment and Kava 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 Kava. Check out your portfolio center. Please also check ongoing floating volatility patterns of AGNC Investment and Kava.

Diversification Opportunities for AGNC Investment and Kava

-0.69

Correlation Coefficient

AGNC Investment  Kava

Excellent diversification

The 3 months correlation between AGNC and Kava is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding AGNC Investment Corp and Kava in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kava 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 Kava. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kava has no effect on the direction of AGNC Investment i.e., AGNC Investment and Kava go up and down completely randomly.

Pair Corralation between AGNC Investment and Kava

Given the investment horizon of 90 days AGNC Investment Corp is expected to generate 0.31 times more return on investment than Kava. However, AGNC Investment Corp is 3.21 times less risky than Kava. It trades about 0.22 of its potential returns per unit of risk. Kava is currently generating about -0.05 per unit of risk. If you would invest  835.00  in AGNC Investment Corp on May 6, 2025 and sell it today you would earn a total of  128.00  from holding AGNC Investment Corp or generate 15.33% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	95.38%
Values	Daily Returns

AGNC Investment Corp  vs.  Kava

AGNC Investment Corp

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in AGNC Investment Corp are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. In spite of rather unfluctuating basic indicators, AGNC Investment exhibited solid returns over the last few months and may actually be approaching a breakup point.

Kava

Risk-Adjusted Performance

Very Weak

Over the last 90 days Kava has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Crypto's fundamental indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for Kava shareholders.

Pair Trading with AGNC Investment and Kava

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

The idea behind AGNC Investment Corp and Kava 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.