Correlation Between Agilent Technologies and Infineon Tech

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

Diversification Opportunities for Agilent Technologies and Infineon Tech

0.59
  Correlation Coefficient

Very weak diversification

The 3 months correlation between Agilent and Infineon is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Agilent Technologies and Infineon Tech ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Infineon Tech ADR 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 Infineon Tech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Infineon Tech ADR has no effect on the direction of Agilent Technologies i.e., Agilent Technologies and Infineon Tech go up and down completely randomly.

Pair Corralation between Agilent Technologies and Infineon Tech

Taking into account the 90-day investment horizon Agilent Technologies is expected to generate 0.65 times more return on investment than Infineon Tech. However, Agilent Technologies is 1.53 times less risky than Infineon Tech. It trades about -0.13 of its potential returns per unit of risk. Infineon Tech ADR is currently generating about -0.15 per unit of risk. If you would invest  12,987  in Agilent Technologies on June 27, 2022 and sell it today you would lose (639.00)  from holding Agilent Technologies or give up 4.92% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

Agilent Technologies  vs.  Infineon Tech ADR

 Performance (%) 
       Timeline  
Agilent Technologies 
Agilent Performance
2 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Agilent Technologies are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Agilent Technologies is not utilizing all of its potentials. The new stock price disturbance, may contribute to short-term losses for the investors.

Agilent Price Channel

Infineon Tech ADR 
Infineon Performance
0 of 100
Over the last 90 days Infineon Tech ADR has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Infineon Price Channel

Agilent Technologies and Infineon Tech Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Agilent Technologies and Infineon Tech

The main advantage of trading using opposite Agilent Technologies and Infineon Tech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Agilent Technologies position performs unexpectedly, Infineon Tech 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 Infineon Tech will offset losses from the drop in Infineon Tech's long position.
Agilent Technologies vs. Sigma Lithium Corp
The idea behind Agilent Technologies and Infineon Tech ADR 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.
Infineon Tech vs. Industrias Bachoco SA
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.

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