Correlation Between TT Electronics and IMAGIN MEDICAL
Can any of the company-specific risk be diversified away by investing in both TT Electronics and IMAGIN MEDICAL 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 TT Electronics and IMAGIN MEDICAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TT Electronics PLC and IMAGIN MEDICAL INC, you can compare the effects of market volatilities on TT Electronics and IMAGIN MEDICAL 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 TT Electronics with a short position of IMAGIN MEDICAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of TT Electronics and IMAGIN MEDICAL.
Diversification Opportunities for TT Electronics and IMAGIN MEDICAL
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between 7TT and IMAGIN is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding TT Electronics PLC and IMAGIN MEDICAL INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IMAGIN MEDICAL INC and TT Electronics 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 TT Electronics PLC are associated (or correlated) with IMAGIN MEDICAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IMAGIN MEDICAL INC has no effect on the direction of TT Electronics i.e., TT Electronics and IMAGIN MEDICAL go up and down completely randomly.
Pair Corralation between TT Electronics and IMAGIN MEDICAL
Assuming the 90 days trading horizon TT Electronics PLC is expected to under-perform the IMAGIN MEDICAL. But the stock apears to be less risky and, when comparing its historical volatility, TT Electronics PLC is 41.59 times less risky than IMAGIN MEDICAL. The stock trades about -0.02 of its potential returns per unit of risk. The IMAGIN MEDICAL INC is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 1.60 in IMAGIN MEDICAL INC on September 28, 2024 and sell it today you would lose (1.55) from holding IMAGIN MEDICAL INC or give up 96.87% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
TT Electronics PLC vs. IMAGIN MEDICAL INC
Performance |
| Timeline |
| TT Electronics PLC |
| IMAGIN MEDICAL INC |
TT Electronics and IMAGIN MEDICAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TT Electronics and IMAGIN MEDICAL
The main advantage of trading using opposite TT Electronics and IMAGIN MEDICAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TT Electronics position performs unexpectedly, IMAGIN MEDICAL 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 IMAGIN MEDICAL will offset losses from the drop in IMAGIN MEDICAL's long position.| TT Electronics vs. PPHE HOTEL GROUP | TT Electronics vs. ALGOMA STEEL GROUP | TT Electronics vs. Perma Fix Environmental Services | TT Electronics vs. Playa Hotels Resorts |
| IMAGIN MEDICAL vs. TT Electronics PLC | IMAGIN MEDICAL vs. Tencent Music Entertainment | IMAGIN MEDICAL vs. G III Apparel Group | IMAGIN MEDICAL vs. Schweizer Electronic AG |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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