Correlation Between Hey Song and TTET Union
Can any of the company-specific risk be diversified away by investing in both Hey Song and TTET Union 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 Hey Song and TTET Union into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hey Song Corp and TTET Union Corp, you can compare the effects of market volatilities on Hey Song and TTET Union 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 Hey Song with a short position of TTET Union. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hey Song and TTET Union.
Diversification Opportunities for Hey Song and TTET Union
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Hey and TTET is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Hey Song Corp and TTET Union Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TTET Union Corp and Hey Song 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 Hey Song Corp are associated (or correlated) with TTET Union. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TTET Union Corp has no effect on the direction of Hey Song i.e., Hey Song and TTET Union go up and down completely randomly.
Pair Corralation between Hey Song and TTET Union
Assuming the 90 days trading horizon Hey Song Corp is expected to generate 0.64 times more return on investment than TTET Union. However, Hey Song Corp is 1.56 times less risky than TTET Union. It trades about 0.05 of its potential returns per unit of risk. TTET Union Corp is currently generating about -0.27 per unit of risk. If you would invest 4,145 in Hey Song Corp on September 4, 2024 and sell it today you would earn a total of 20.00 from holding Hey Song Corp or generate 0.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hey Song Corp vs. TTET Union Corp
Performance |
| Timeline |
| Hey Song Corp |
| TTET Union Corp |
Hey Song and TTET Union Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hey Song and TTET Union
The main advantage of trading using opposite Hey Song and TTET Union positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hey Song position performs unexpectedly, TTET Union 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 TTET Union will offset losses from the drop in TTET Union's long position.| Hey Song vs. Great Wall Enterprise | Hey Song vs. Uni President Enterprises Corp | Hey Song vs. Wei Chuan Foods | Hey Song vs. Taisun Enterprise Co |
| TTET Union vs. Charoen Pokphand Enterprise | TTET Union vs. Standard Foods Corp | TTET Union vs. Uni President Enterprises Corp | TTET Union vs. Great Wall Enterprise |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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