Correlation Between Trump Media and TuanChe ADR
Can any of the company-specific risk be diversified away by investing in both Trump Media and TuanChe ADR 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 Trump Media and TuanChe ADR into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Trump Media Technology and TuanChe ADR, you can compare the effects of market volatilities on Trump Media and TuanChe ADR 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 Trump Media with a short position of TuanChe ADR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Trump Media and TuanChe ADR.
Diversification Opportunities for Trump Media and TuanChe ADR
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Trump and TuanChe is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Trump Media Technology and TuanChe ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TuanChe ADR and Trump Media 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 Trump Media Technology are associated (or correlated) with TuanChe ADR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TuanChe ADR has no effect on the direction of Trump Media i.e., Trump Media and TuanChe ADR go up and down completely randomly.
Pair Corralation between Trump Media and TuanChe ADR
Assuming the 90 days horizon Trump Media Technology is expected to generate 1.71 times more return on investment than TuanChe ADR. However, Trump Media is 1.71 times more volatile than TuanChe ADR. It trades about 0.12 of its potential returns per unit of risk. TuanChe ADR is currently generating about -0.14 per unit of risk. If you would invest 1,304 in Trump Media Technology on August 29, 2024 and sell it today you would earn a total of 788.00 from holding Trump Media Technology or generate 60.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Trump Media Technology vs. TuanChe ADR
Performance |
| Timeline |
| Trump Media Technology |
| TuanChe ADR |
Trump Media and TuanChe ADR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Trump Media and TuanChe ADR
The main advantage of trading using opposite Trump Media and TuanChe ADR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Trump Media position performs unexpectedly, TuanChe ADR 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 TuanChe ADR will offset losses from the drop in TuanChe ADR's long position.| Trump Media vs. Everspin Technologies | Trump Media vs. Coty Inc | Trump Media vs. Lindblad Expeditions Holdings | Trump Media vs. Elmos Semiconductor SE |
| TuanChe ADR vs. Onfolio Holdings | TuanChe ADR vs. Starbox Group Holdings | TuanChe ADR vs. MediaAlpha | TuanChe ADR vs. Metalpha Technology Holding |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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