Correlation Between Benguet Corp and AgriNurture

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

By analyzing existing cross correlation between Benguet Corp A and AgriNurture, you can compare the effects of market volatilities on Benguet Corp and AgriNurture 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 Benguet Corp with a short position of AgriNurture. Check out your portfolio center. Please also check ongoing floating volatility patterns of Benguet Corp and AgriNurture.

Diversification Opportunities for Benguet Corp and AgriNurture

-0.34

Correlation Coefficient

Benguet Corp  AgriNurture

Very good diversification

The 3 months correlation between Benguet and AgriNurture is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Benguet Corp A and AgriNurture in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AgriNurture and Benguet Corp 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 Benguet Corp A are associated (or correlated) with AgriNurture. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AgriNurture has no effect on the direction of Benguet Corp i.e., Benguet Corp and AgriNurture go up and down completely randomly.

Pair Corralation between Benguet Corp and AgriNurture

Assuming the 90 days trading horizon Benguet Corp A is expected to generate 0.84 times more return on investment than AgriNurture. However, Benguet Corp A is 1.2 times less risky than AgriNurture. It trades about 0.04 of its potential returns per unit of risk. AgriNurture is currently generating about -0.07 per unit of risk. If you would invest  424.00  in Benguet Corp A on April 20, 2025 and sell it today you would earn a total of  11.00  from holding Benguet Corp A or generate 2.59% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	90.57%
Values	Daily Returns

Benguet Corp A  vs.  AgriNurture

Benguet Corp A

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Benguet Corp A are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, Benguet Corp is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

AgriNurture

Risk-Adjusted Performance

Very Weak

Over the last 90 days AgriNurture has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's technical and fundamental indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Pair Trading with Benguet Corp and AgriNurture

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

The idea behind Benguet Corp A and AgriNurture 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.

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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.