Correlation Between InfuSystems Holdings and AG Mortgage

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

By analyzing existing cross correlation between InfuSystems Holdings and AG Mortgage Investment, you can compare the effects of market volatilities on InfuSystems Holdings and AG Mortgage 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 InfuSystems Holdings with a short position of AG Mortgage. Check out your portfolio center. Please also check ongoing floating volatility patterns of InfuSystems Holdings and AG Mortgage.

Diversification Opportunities for InfuSystems Holdings and AG Mortgage

0.77

Correlation Coefficient

InfuSystems Holdings  AG Mortgage

Poor diversification

The 3 months correlation between InfuSystems and MITP is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding InfuSystems Holdings and AG Mortgage Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AG Mortgage Investment and InfuSystems Holdings 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 InfuSystems Holdings are associated (or correlated) with AG Mortgage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AG Mortgage Investment has no effect on the direction of InfuSystems Holdings i.e., InfuSystems Holdings and AG Mortgage go up and down completely randomly.

Pair Corralation between InfuSystems Holdings and AG Mortgage

Given the investment horizon of 90 days InfuSystems Holdings is expected to generate 19.03 times more return on investment than AG Mortgage. However, InfuSystems Holdings is 19.03 times more volatile than AG Mortgage Investment. It trades about 0.27 of its potential returns per unit of risk. AG Mortgage Investment is currently generating about 0.32 per unit of risk. If you would invest  519.00  in InfuSystems Holdings on May 27, 2025 and sell it today you would earn a total of  471.00  from holding InfuSystems Holdings or generate 90.75% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.44%
Values	Daily Returns

InfuSystems Holdings  vs.  AG Mortgage Investment

InfuSystems Holdings

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in InfuSystems Holdings are ranked lower than 21 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unfluctuating technical and fundamental indicators, InfuSystems Holdings unveiled solid returns over the last few months and may actually be approaching a breakup point.

AG Mortgage Investment

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in AG Mortgage Investment are ranked lower than 25 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable basic indicators, AG Mortgage is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with InfuSystems Holdings and AG Mortgage

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

The idea behind InfuSystems Holdings and AG Mortgage Investment 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.