Correlation Between Sipp Industries and Agritek Holdings

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

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

Diversification Opportunities for Sipp Industries and Agritek Holdings

0.15

Correlation Coefficient

Sipp Industries  Agritek Holdings

Average diversification

The 3 months correlation between Sipp and Agritek is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Sipp Industries New and Agritek Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Agritek Holdings and Sipp Industries 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 Sipp Industries New are associated (or correlated) with Agritek Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Agritek Holdings has no effect on the direction of Sipp Industries i.e., Sipp Industries and Agritek Holdings go up and down completely randomly.

Pair Corralation between Sipp Industries and Agritek Holdings

Given the investment horizon of 90 days Sipp Industries is expected to generate 36.64 times less return on investment than Agritek Holdings. But when comparing it to its historical volatility, Sipp Industries New is 14.5 times less risky than Agritek Holdings. It trades about 0.06 of its potential returns per unit of risk. Agritek Holdings is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest  0.01  in Agritek Holdings on May 5, 2025 and sell it today you would earn a total of  0.00  from holding Agritek Holdings or generate 0.0% return on investment over 90 days.

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

Sipp Industries New  vs.  Agritek Holdings

Sipp Industries New

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Sipp Industries New are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak basic indicators, Sipp Industries exhibited solid returns over the last few months and may actually be approaching a breakup point.

Agritek Holdings

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Agritek Holdings are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite quite weak basic indicators, Agritek Holdings disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Sipp Industries and Agritek Holdings

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

The idea behind Sipp Industries New and Agritek Holdings 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.