Correlation Between Bridge Investment and TPG
Can any of the company-specific risk be diversified away by investing in both Bridge Investment and TPG 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 Bridge Investment and TPG into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bridge Investment Group and TPG Inc, you can compare the effects of market volatilities on Bridge Investment and TPG 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 Bridge Investment with a short position of TPG. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bridge Investment and TPG.
Diversification Opportunities for Bridge Investment and TPG
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Bridge and TPG is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Bridge Investment Group and TPG Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TPG Inc and Bridge Investment 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 Bridge Investment Group are associated (or correlated) with TPG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TPG Inc has no effect on the direction of Bridge Investment i.e., Bridge Investment and TPG go up and down completely randomly.
Pair Corralation between Bridge Investment and TPG
Given the investment horizon of 90 days Bridge Investment is expected to generate 5.69 times less return on investment than TPG. In addition to that, Bridge Investment is 1.39 times more volatile than TPG Inc. It trades about 0.02 of its total potential returns per unit of risk. TPG Inc is currently generating about 0.16 per unit of volatility. If you would invest 2,705 in TPG Inc on August 29, 2024 and sell it today you would earn a total of 4,276 from holding TPG Inc or generate 158.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bridge Investment Group vs. TPG Inc
Performance |
| Timeline |
| Bridge Investment |
| TPG Inc |
Bridge Investment and TPG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bridge Investment and TPG
The main advantage of trading using opposite Bridge Investment and TPG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bridge Investment position performs unexpectedly, TPG 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 TPG will offset losses from the drop in TPG's long position.| Bridge Investment vs. TPG Inc | Bridge Investment vs. Carlyle Secured Lending | Bridge Investment vs. Brookfield Corp |
| TPG vs. Ares Management LP | TPG vs. Patria Investments | TPG vs. Apollo Global Management | TPG vs. Cion Investment Corp |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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