Correlation Between Teradata Corp and ONEOK
Can any of the company-specific risk be diversified away by investing in both Teradata Corp and ONEOK 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 Teradata Corp and ONEOK into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Teradata Corp and ONEOK Inc, you can compare the effects of market volatilities on Teradata Corp and ONEOK 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 Teradata Corp with a short position of ONEOK. Check out your portfolio center. Please also check ongoing floating volatility patterns of Teradata Corp and ONEOK.
Diversification Opportunities for Teradata Corp and ONEOK
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Teradata and ONEOK is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Teradata Corp and ONEOK Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ONEOK Inc and Teradata 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 Teradata Corp are associated (or correlated) with ONEOK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ONEOK Inc has no effect on the direction of Teradata Corp i.e., Teradata Corp and ONEOK go up and down completely randomly.
Pair Corralation between Teradata Corp and ONEOK
Assuming the 90 days trading horizon Teradata Corp is expected to under-perform the ONEOK. In addition to that, Teradata Corp is 1.01 times more volatile than ONEOK Inc. It trades about -0.23 of its total potential returns per unit of risk. ONEOK Inc is currently generating about -0.12 per unit of volatility. If you would invest 10,478 in ONEOK Inc on October 12, 2024 and sell it today you would lose (295.00) from holding ONEOK Inc or give up 2.82% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 90.0% |
| Values | Daily Returns |
Teradata Corp vs. ONEOK Inc
Performance |
| Timeline |
| Teradata Corp |
| ONEOK Inc |
Teradata Corp and ONEOK Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Teradata Corp and ONEOK
The main advantage of trading using opposite Teradata Corp and ONEOK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Teradata Corp position performs unexpectedly, ONEOK 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 ONEOK will offset losses from the drop in ONEOK's long position.| Teradata Corp vs. Atalaya Mining | Teradata Corp vs. European Metals Holdings | Teradata Corp vs. Ecclesiastical Insurance Office | Teradata Corp vs. Broadcom |
| ONEOK vs. Anglo Asian Mining | ONEOK vs. Teradata Corp | ONEOK vs. iShares Physical Silver | ONEOK vs. Lundin Mining Corp |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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