Correlation Between Tehmag Foods and Gloria Material
Can any of the company-specific risk be diversified away by investing in both Tehmag Foods and Gloria Material 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 Gloria Material into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tehmag Foods and Gloria Material Technology, you can compare the effects of market volatilities on Tehmag Foods and Gloria Material 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 Gloria Material. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tehmag Foods and Gloria Material.
Diversification Opportunities for Tehmag Foods and Gloria Material
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Tehmag and Gloria is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Tehmag Foods and Gloria Material Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gloria Material Tech 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 Gloria Material. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gloria Material Tech has no effect on the direction of Tehmag Foods i.e., Tehmag Foods and Gloria Material go up and down completely randomly.
Pair Corralation between Tehmag Foods and Gloria Material
Assuming the 90 days trading horizon Tehmag Foods is expected to generate 0.34 times more return on investment than Gloria Material. However, Tehmag Foods is 2.9 times less risky than Gloria Material. It trades about 0.03 of its potential returns per unit of risk. Gloria Material Technology is currently generating about -0.02 per unit of risk. If you would invest 29,739 in Tehmag Foods on August 31, 2024 and sell it today you would earn a total of 611.00 from holding Tehmag Foods or generate 2.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tehmag Foods vs. Gloria Material Technology
Performance |
| Timeline |
| Tehmag Foods |
| Gloria Material Tech |
Tehmag Foods and Gloria Material Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tehmag Foods and Gloria Material
The main advantage of trading using opposite Tehmag Foods and Gloria Material positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tehmag Foods position performs unexpectedly, Gloria Material 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 Gloria Material will offset losses from the drop in Gloria Material's long position.| Tehmag Foods vs. Uni President Enterprises Corp | Tehmag Foods vs. Tingyi Holding Corp | Tehmag Foods vs. Lien Hwa Industrial | Tehmag Foods vs. Great Wall Enterprise |
| Gloria Material vs. Synmosa Biopharma | Gloria Material vs. Taiwan Glass Ind | Gloria Material vs. Tong Tai Machine Tool | Gloria Material vs. Oriental Union Chemical |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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