Correlation Between Ton Yi and Tex Ray
Can any of the company-specific risk be diversified away by investing in both Ton Yi and Tex Ray 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 Ton Yi and Tex Ray into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ton Yi Industrial and Tex Ray Industrial Co, you can compare the effects of market volatilities on Ton Yi and Tex Ray 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 Ton Yi with a short position of Tex Ray. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ton Yi and Tex Ray.
Diversification Opportunities for Ton Yi and Tex Ray
Very good diversification
The 3 months correlation between Ton and Tex is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Ton Yi Industrial and Tex Ray Industrial Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tex Ray Industrial and Ton Yi 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 Ton Yi Industrial are associated (or correlated) with Tex Ray. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tex Ray Industrial has no effect on the direction of Ton Yi i.e., Ton Yi and Tex Ray go up and down completely randomly.
Pair Corralation between Ton Yi and Tex Ray
Assuming the 90 days trading horizon Ton Yi Industrial is expected to under-perform the Tex Ray. In addition to that, Ton Yi is 1.22 times more volatile than Tex Ray Industrial Co. It trades about -0.11 of its total potential returns per unit of risk. Tex Ray Industrial Co is currently generating about 0.08 per unit of volatility. If you would invest 1,055 in Tex Ray Industrial Co on September 1, 2024 and sell it today you would earn a total of 25.00 from holding Tex Ray Industrial Co or generate 2.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ton Yi Industrial vs. Tex Ray Industrial Co
Performance |
| Timeline |
| Ton Yi Industrial |
| Tex Ray Industrial |
Ton Yi and Tex Ray Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ton Yi and Tex Ray
The main advantage of trading using opposite Ton Yi and Tex Ray positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ton Yi position performs unexpectedly, Tex Ray 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 Tex Ray will offset losses from the drop in Tex Ray's long position.| Ton Yi vs. Far Eastern Department | Ton Yi vs. Chang Hwa Commercial | Ton Yi vs. Zinwell | Ton Yi vs. Evergreen International Storage |
| Tex Ray vs. Tainan Enterprises Co | Tex Ray vs. De Licacy Industrial | Tex Ray vs. Nien Hsing Textile | Tex Ray vs. Wisher Industrial Co |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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