Correlation Between AgrifyCorp and Deere
Can any of the company-specific risk be diversified away by investing in both AgrifyCorp and Deere 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 AgrifyCorp and Deere into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AgrifyCorp and Deere Company, you can compare the effects of market volatilities on AgrifyCorp and Deere 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 AgrifyCorp with a short position of Deere. Check out your portfolio center. Please also check ongoing floating volatility patterns of AgrifyCorp and Deere.
Diversification Opportunities for AgrifyCorp and Deere
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between AgrifyCorp and Deere is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding AgrifyCorp and Deere Company in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Deere Company and AgrifyCorp 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 AgrifyCorp are associated (or correlated) with Deere. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Deere Company has no effect on the direction of AgrifyCorp i.e., AgrifyCorp and Deere go up and down completely randomly.
Pair Corralation between AgrifyCorp and Deere
Given the investment horizon of 90 days AgrifyCorp is expected to generate 4.94 times more return on investment than Deere. However, AgrifyCorp is 4.94 times more volatile than Deere Company. It trades about 0.06 of its potential returns per unit of risk. Deere Company is currently generating about -0.24 per unit of risk. If you would invest 29.00 in AgrifyCorp on February 28, 2024 and sell it today you would earn a total of 1.00 from holding AgrifyCorp or generate 3.45% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 95.45% |
Values | Daily Returns |
AgrifyCorp vs. Deere Company
Performance |
Timeline |
AgrifyCorp |
Deere Company |
AgrifyCorp and Deere Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with AgrifyCorp and Deere
The main advantage of trading using opposite AgrifyCorp and Deere positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AgrifyCorp position performs unexpectedly, Deere 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 Deere will offset losses from the drop in Deere's long position.AgrifyCorp vs. MYR Group | AgrifyCorp vs. Granite Construction Incorporated | AgrifyCorp vs. Construction Partners | AgrifyCorp vs. Great Lakes Dredge |
Check out your portfolio center.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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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