Correlation Between Affiliated Managers and AG Mortgage

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

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

Diversification Opportunities for Affiliated Managers and AG Mortgage

0.84

Correlation Coefficient

Affiliated Managers  AG Mortgage

Very poor diversification

The 3 months correlation between Affiliated and MITN is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Affiliated Managers Group, 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 Affiliated Managers 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 Affiliated Managers Group, 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 Affiliated Managers i.e., Affiliated Managers and AG Mortgage go up and down completely randomly.

Pair Corralation between Affiliated Managers and AG Mortgage

Given the investment horizon of 90 days Affiliated Managers Group, is expected to generate 2.33 times more return on investment than AG Mortgage. However, Affiliated Managers is 2.33 times more volatile than AG Mortgage Investment. It trades about 0.17 of its potential returns per unit of risk. AG Mortgage Investment is currently generating about 0.12 per unit of risk. If you would invest  1,692  in Affiliated Managers Group, on July 7, 2025 and sell it today you would earn a total of  144.00  from holding Affiliated Managers Group, or generate 8.51% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	100.0%
Values	Daily Returns

Affiliated Managers Group,  vs.  AG Mortgage Investment

Affiliated Managers

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Affiliated Managers Group, are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Affiliated Managers may actually be approaching a critical reversion point that can send shares even higher in November 2025.

AG Mortgage Investment

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in AG Mortgage Investment are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, AG Mortgage is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Affiliated Managers and AG Mortgage

The main advantage of trading using opposite Affiliated Managers and AG Mortgage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Affiliated Managers 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 Affiliated Managers Group, 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.