Correlation Between TT Electronics and Kering SA
Can any of the company-specific risk be diversified away by investing in both TT Electronics and Kering SA 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 Kering SA 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 Kering SA, you can compare the effects of market volatilities on TT Electronics and Kering SA 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 Kering SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of TT Electronics and Kering SA.
Diversification Opportunities for TT Electronics and Kering SA
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between 7TT and Kering is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding TT Electronics PLC and Kering SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kering SA 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 Kering SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kering SA has no effect on the direction of TT Electronics i.e., TT Electronics and Kering SA go up and down completely randomly.
Pair Corralation between TT Electronics and Kering SA
Assuming the 90 days trading horizon TT Electronics PLC is expected to under-perform the Kering SA. In addition to that, TT Electronics is 1.5 times more volatile than Kering SA. It trades about -0.33 of its total potential returns per unit of risk. Kering SA is currently generating about -0.17 per unit of volatility. If you would invest 23,950 in Kering SA on October 10, 2024 and sell it today you would lose (1,100) from holding Kering SA or give up 4.59% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 94.44% |
| Values | Daily Returns |
TT Electronics PLC vs. Kering SA
Performance |
| Timeline |
| TT Electronics PLC |
| Kering SA |
TT Electronics and Kering SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TT Electronics and Kering SA
The main advantage of trading using opposite TT Electronics and Kering SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TT Electronics position performs unexpectedly, Kering SA 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 Kering SA will offset losses from the drop in Kering SA's long position.| TT Electronics vs. BioNTech SE | TT Electronics vs. ORMAT TECHNOLOGIES | TT Electronics vs. Motorcar Parts of | TT Electronics vs. Digilife Technologies Limited |
| Kering SA vs. ONWARD MEDICAL BV | Kering SA vs. Sun Life Financial | Kering SA vs. IMAGIN MEDICAL INC | Kering SA vs. REVO INSURANCE SPA |
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 Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
Other Complementary Tools
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Stocks Directory Find actively traded stocks across global markets | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated |