Correlation Between Collins Foods and TINC Comm
Can any of the company-specific risk be diversified away by investing in both Collins Foods and TINC Comm 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 Collins Foods and TINC Comm into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Collins Foods Limited and TINC Comm VA, you can compare the effects of market volatilities on Collins Foods and TINC Comm 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 Collins Foods with a short position of TINC Comm. Check out your portfolio center. Please also check ongoing floating volatility patterns of Collins Foods and TINC Comm.
Diversification Opportunities for Collins Foods and TINC Comm
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between Collins and TINC is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Collins Foods Limited and TINC Comm VA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TINC Comm VA and Collins 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 Collins Foods Limited are associated (or correlated) with TINC Comm. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TINC Comm VA has no effect on the direction of Collins Foods i.e., Collins Foods and TINC Comm go up and down completely randomly.
Pair Corralation between Collins Foods and TINC Comm
Assuming the 90 days horizon Collins Foods Limited is expected to generate 2.09 times more return on investment than TINC Comm. However, Collins Foods is 2.09 times more volatile than TINC Comm VA. It trades about 0.03 of its potential returns per unit of risk. TINC Comm VA is currently generating about -0.01 per unit of risk. If you would invest 401.00 in Collins Foods Limited on September 12, 2024 and sell it today you would earn a total of 77.00 from holding Collins Foods Limited or generate 19.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Collins Foods Limited vs. TINC Comm VA
Performance |
| Timeline |
| Collins Foods Limited |
| TINC Comm VA |
Collins Foods and TINC Comm Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Collins Foods and TINC Comm
The main advantage of trading using opposite Collins Foods and TINC Comm positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Collins Foods position performs unexpectedly, TINC Comm 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 TINC Comm will offset losses from the drop in TINC Comm's long position.| Collins Foods vs. Starbucks | Collins Foods vs. Superior Plus Corp | Collins Foods vs. SIVERS SEMICONDUCTORS AB | Collins Foods vs. NorAm Drilling AS |
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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 Global Correlations module to find global opportunities by holding instruments from different markets.
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