Correlation Between Delta Air and AGNC INVESTMENT

Can any of the company-specific risk be diversified away by investing in both Delta Air and AGNC INVESTMENT 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 Delta Air and AGNC INVESTMENT into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Delta Air Lines and AGNC INVESTMENT, you can compare the effects of market volatilities on Delta Air and AGNC INVESTMENT 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 Delta Air with a short position of AGNC INVESTMENT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Delta Air and AGNC INVESTMENT.

Diversification Opportunities for Delta Air and AGNC INVESTMENT

0.61

Correlation Coefficient

Delta Air  AGNC INVESTMENT

Poor diversification

The 3 months correlation between Delta and AGNC is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Delta Air Lines and AGNC INVESTMENT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AGNC INVESTMENT and Delta Air 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 Delta Air Lines are associated (or correlated) with AGNC INVESTMENT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AGNC INVESTMENT has no effect on the direction of Delta Air i.e., Delta Air and AGNC INVESTMENT go up and down completely randomly.

Pair Corralation between Delta Air and AGNC INVESTMENT

Assuming the 90 days horizon Delta Air Lines is expected to generate 2.29 times more return on investment than AGNC INVESTMENT. However, Delta Air is 2.29 times more volatile than AGNC INVESTMENT. It trades about 0.08 of its potential returns per unit of risk. AGNC INVESTMENT is currently generating about 0.14 per unit of risk. If you would invest  3,980  in Delta Air Lines on May 7, 2025 and sell it today you would earn a total of  578.00  from holding Delta Air Lines or generate 14.52% return on investment over 90 days.

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

Delta Air Lines  vs.  AGNC INVESTMENT

Delta Air Lines

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Delta Air Lines are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, Delta Air reported solid returns over the last few months and may actually be approaching a breakup point.

AGNC INVESTMENT

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in AGNC INVESTMENT are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, AGNC INVESTMENT may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with Delta Air and AGNC INVESTMENT

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

The idea behind Delta Air Lines and AGNC 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.