Correlation Between Tesna and Wonik Ips
Can any of the company-specific risk be diversified away by investing in both Tesna and Wonik Ips 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 Tesna and Wonik Ips into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tesna Inc and Wonik Ips Co, you can compare the effects of market volatilities on Tesna and Wonik Ips 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 Tesna with a short position of Wonik Ips. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tesna and Wonik Ips.
Diversification Opportunities for Tesna and Wonik Ips
Almost no diversification
The 3 months correlation between Tesna and Wonik is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Tesna Inc and Wonik Ips Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wonik Ips and Tesna 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 Tesna Inc are associated (or correlated) with Wonik Ips. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wonik Ips has no effect on the direction of Tesna i.e., Tesna and Wonik Ips go up and down completely randomly.
Pair Corralation between Tesna and Wonik Ips
Assuming the 90 days trading horizon Tesna Inc is expected to generate 1.48 times more return on investment than Wonik Ips. However, Tesna is 1.48 times more volatile than Wonik Ips Co. It trades about -0.12 of its potential returns per unit of risk. Wonik Ips Co is currently generating about -0.34 per unit of risk. If you would invest 3,000,000 in Tesna Inc on September 1, 2024 and sell it today you would lose (340,000) from holding Tesna Inc or give up 11.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Tesna Inc vs. Wonik Ips Co
Performance |
| Timeline |
| Tesna Inc |
| Wonik Ips |
Tesna and Wonik Ips Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tesna and Wonik Ips
The main advantage of trading using opposite Tesna and Wonik Ips positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tesna position performs unexpectedly, Wonik Ips 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 Wonik Ips will offset losses from the drop in Wonik Ips' long position.The idea behind Tesna Inc and Wonik Ips Co pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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