Correlation Between Tehmag Foods and Skardin Industrial
Can any of the company-specific risk be diversified away by investing in both Tehmag Foods and Skardin Industrial 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 Skardin Industrial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tehmag Foods and Skardin Industrial, you can compare the effects of market volatilities on Tehmag Foods and Skardin Industrial 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 Skardin Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tehmag Foods and Skardin Industrial.
Diversification Opportunities for Tehmag Foods and Skardin Industrial
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Tehmag and Skardin is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Tehmag Foods and Skardin Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Skardin Industrial 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 Skardin Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Skardin Industrial has no effect on the direction of Tehmag Foods i.e., Tehmag Foods and Skardin Industrial go up and down completely randomly.
Pair Corralation between Tehmag Foods and Skardin Industrial
Assuming the 90 days trading horizon Tehmag Foods is expected to generate 0.09 times more return on investment than Skardin Industrial. However, Tehmag Foods is 11.12 times less risky than Skardin Industrial. It trades about -0.09 of its potential returns per unit of risk. Skardin Industrial is currently generating about -0.17 per unit of risk. If you would invest 30,600 in Tehmag Foods on September 1, 2024 and sell it today you would lose (250.00) from holding Tehmag Foods or give up 0.82% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tehmag Foods vs. Skardin Industrial
Performance |
| Timeline |
| Tehmag Foods |
| Skardin Industrial |
Tehmag Foods and Skardin Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tehmag Foods and Skardin Industrial
The main advantage of trading using opposite Tehmag Foods and Skardin Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tehmag Foods position performs unexpectedly, Skardin Industrial 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 Skardin Industrial will offset losses from the drop in Skardin Industrial's long position.| Tehmag Foods vs. Yuanta Financial Holdings | Tehmag Foods vs. Fubon Financial Holding | Tehmag Foods vs. CHINA DEVELOPMENT FINANCIAL | Tehmag Foods vs. Advanced Wireless Semiconductor |
| Skardin Industrial vs. Accton Technology Corp | Skardin Industrial vs. HTC Corp | Skardin Industrial vs. Wistron NeWeb Corp | Skardin Industrial vs. Arcadyan Technology 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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