Correlation Between People Technology and Tesna
Can any of the company-specific risk be diversified away by investing in both People Technology and Tesna 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 People Technology and Tesna into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between People Technology and Tesna Inc, you can compare the effects of market volatilities on People Technology and Tesna 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 People Technology with a short position of Tesna. Check out your portfolio center. Please also check ongoing floating volatility patterns of People Technology and Tesna.
Diversification Opportunities for People Technology and Tesna
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between People and Tesna is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding People Technology and Tesna Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tesna Inc and People Technology 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 People Technology are associated (or correlated) with Tesna. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tesna Inc has no effect on the direction of People Technology i.e., People Technology and Tesna go up and down completely randomly.
Pair Corralation between People Technology and Tesna
Assuming the 90 days trading horizon People Technology is expected to generate 1.06 times more return on investment than Tesna. However, People Technology is 1.06 times more volatile than Tesna Inc. It trades about -0.1 of its potential returns per unit of risk. Tesna Inc is currently generating about -0.16 per unit of risk. If you would invest 5,120,000 in People Technology on August 25, 2024 and sell it today you would lose (480,000) from holding People Technology or give up 9.37% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
People Technology vs. Tesna Inc
Performance |
| Timeline |
| People Technology |
| Tesna Inc |
People Technology and Tesna Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with People Technology and Tesna
The main advantage of trading using opposite People Technology and Tesna positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if People Technology position performs unexpectedly, Tesna 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 Tesna will offset losses from the drop in Tesna's long position.| People Technology vs. Woori Technology | People Technology vs. Lion Chemtech Co | People Technology vs. ABCO Electronics Co | People Technology vs. Korea Alcohol Industrial |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
Other Complementary Tools
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device |