Correlation Between Agilent Technologies and Equity Lifestyle

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Can any of the company-specific risk be diversified away by investing in both Agilent Technologies and Equity Lifestyle 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 Agilent Technologies and Equity Lifestyle into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Agilent Technologies and Equity Lifestyle Properties, you can compare the effects of market volatilities on Agilent Technologies and Equity Lifestyle 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 Agilent Technologies with a short position of Equity Lifestyle. Check out your portfolio center. Please also check ongoing floating volatility patterns of Agilent Technologies and Equity Lifestyle.

Diversification Opportunities for Agilent Technologies and Equity Lifestyle

0.48
  Correlation Coefficient

Very weak diversification

The 3 months correlation between Agilent and Equity is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Agilent Technologies and Equity Lifestyle Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Equity Lifestyle Pro and Agilent Technologies 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 Agilent Technologies are associated (or correlated) with Equity Lifestyle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Equity Lifestyle Pro has no effect on the direction of Agilent Technologies i.e., Agilent Technologies and Equity Lifestyle go up and down completely randomly.

Pair Corralation between Agilent Technologies and Equity Lifestyle

Taking into account the 90-day investment horizon Agilent Technologies is expected to generate 1.18 times more return on investment than Equity Lifestyle. However, Agilent Technologies is 1.18 times more volatile than Equity Lifestyle Properties. It trades about 0.05 of its potential returns per unit of risk. Equity Lifestyle Properties is currently generating about -0.22 per unit of risk. If you would invest  12,908  in Agilent Technologies on July 6, 2022 and sell it today you would earn a total of  233.00  from holding Agilent Technologies or generate 1.81% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

Agilent Technologies  vs.  Equity Lifestyle Properties

 Performance (%) 
       Timeline  
Agilent Technologies 
Agilent Performance
5 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Agilent Technologies are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite somewhat conflicting basic indicators, Agilent Technologies may actually be approaching a critical reversion point that can send shares even higher in November 2022.

Agilent Price Channel

Equity Lifestyle Pro 
Equity Performance
0 of 100
Over the last 90 days Equity Lifestyle Properties has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest conflicting performance, the Stock's essential indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Equity Price Channel

Agilent Technologies and Equity Lifestyle Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Agilent Technologies and Equity Lifestyle

The main advantage of trading using opposite Agilent Technologies and Equity Lifestyle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Agilent Technologies position performs unexpectedly, Equity Lifestyle 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 Equity Lifestyle will offset losses from the drop in Equity Lifestyle's long position.
Agilent Technologies vs. Amazon Inc
The idea behind Agilent Technologies and Equity Lifestyle Properties 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.
Equity Lifestyle vs. Amazon Inc
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.

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