Correlation Between Tehmag Foods and TTET Union
Can any of the company-specific risk be diversified away by investing in both Tehmag Foods 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 Tehmag Foods and TTET Union into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tehmag Foods and TTET Union Corp, you can compare the effects of market volatilities on Tehmag Foods 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 Tehmag Foods with a short position of TTET Union. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tehmag Foods and TTET Union.
Diversification Opportunities for Tehmag Foods and TTET Union
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Tehmag and TTET is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Tehmag Foods 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 Tehmag Foods 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 Tehmag Foods 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 Tehmag Foods i.e., Tehmag Foods and TTET Union go up and down completely randomly.
Pair Corralation between Tehmag Foods and TTET Union
Assuming the 90 days trading horizon Tehmag Foods is expected to generate 0.53 times more return on investment than TTET Union. However, Tehmag Foods is 1.87 times less risky than TTET Union. It trades about -0.11 of its potential returns per unit of risk. TTET Union Corp is currently generating about -0.33 per unit of risk. If you would invest 30,750 in Tehmag Foods on August 28, 2024 and sell it today you would lose (300.00) from holding Tehmag Foods or give up 0.98% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tehmag Foods vs. TTET Union Corp
Performance |
| Timeline |
| Tehmag Foods |
| TTET Union Corp |
Tehmag Foods and TTET Union Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tehmag Foods and TTET Union
The main advantage of trading using opposite Tehmag Foods and TTET Union positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tehmag Foods 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.| Tehmag Foods vs. Grand Pacific Petrochemical | Tehmag Foods vs. Sunspring Metal Corp | Tehmag Foods vs. Acelon Chemicals Fiber | Tehmag Foods vs. Chi Sheng Chemical |
| 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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