Correlation Between Brandes International and Touchstone Sands
Can any of the company-specific risk be diversified away by investing in both Brandes International and Touchstone Sands 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 Brandes International and Touchstone Sands into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Brandes International Equity and Touchstone Sands Capital, you can compare the effects of market volatilities on Brandes International and Touchstone Sands 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 Brandes International with a short position of Touchstone Sands. Check out your portfolio center. Please also check ongoing floating volatility patterns of Brandes International and Touchstone Sands.
Diversification Opportunities for Brandes International and Touchstone Sands
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Brandes and Touchstone is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Brandes International Equity and Touchstone Sands Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Touchstone Sands Capital and Brandes International 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 Brandes International Equity are associated (or correlated) with Touchstone Sands. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Touchstone Sands Capital has no effect on the direction of Brandes International i.e., Brandes International and Touchstone Sands go up and down completely randomly.
Pair Corralation between Brandes International and Touchstone Sands
Assuming the 90 days horizon Brandes International is expected to generate 1.82 times less return on investment than Touchstone Sands. But when comparing it to its historical volatility, Brandes International Equity is 1.88 times less risky than Touchstone Sands. It trades about 0.1 of its potential returns per unit of risk. Touchstone Sands Capital is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 989.00 in Touchstone Sands Capital on August 30, 2024 and sell it today you would earn a total of 853.00 from holding Touchstone Sands Capital or generate 86.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Brandes International Equity vs. Touchstone Sands Capital
Performance |
| Timeline |
| Brandes International |
| Touchstone Sands Capital |
Brandes International and Touchstone Sands Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Brandes International and Touchstone Sands
The main advantage of trading using opposite Brandes International and Touchstone Sands positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Brandes International position performs unexpectedly, Touchstone Sands 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 Touchstone Sands will offset losses from the drop in Touchstone Sands' long position.| Brandes International vs. Tcm Small Cap | Brandes International vs. Vanguard Short Term Investment Grade | Brandes International vs. Goldman Sachs Growth | Brandes International vs. Us Small Cap |
| Touchstone Sands vs. Sentinel Mon Stock | Touchstone Sands vs. Touchstone Sands Capital | Touchstone Sands vs. Touchstone Value Fund | Touchstone Sands vs. The Hartford Floating |
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 Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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