Correlation Between First Tractor and Textainer Group
Can any of the company-specific risk be diversified away by investing in both First Tractor and Textainer Group 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 First Tractor and Textainer Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Tractor and Textainer Group Holdings, you can compare the effects of market volatilities on First Tractor and Textainer Group 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 First Tractor with a short position of Textainer Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Tractor and Textainer Group.
Diversification Opportunities for First Tractor and Textainer Group
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between First and Textainer is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding First Tractor and Textainer Group Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Textainer Group Holdings and First Tractor 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 First Tractor are associated (or correlated) with Textainer Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Textainer Group Holdings has no effect on the direction of First Tractor i.e., First Tractor and Textainer Group go up and down completely randomly.
Pair Corralation between First Tractor and Textainer Group
Assuming the 90 days horizon First Tractor is expected to generate 2.25 times less return on investment than Textainer Group. In addition to that, First Tractor is 1.07 times more volatile than Textainer Group Holdings. It trades about 0.03 of its total potential returns per unit of risk. Textainer Group Holdings is currently generating about 0.07 per unit of volatility. If you would invest 38.00 in Textainer Group Holdings on August 30, 2024 and sell it today you would earn a total of 35.00 from holding Textainer Group Holdings or generate 92.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 77.97% |
| Values | Daily Returns |
First Tractor vs. Textainer Group Holdings
Performance |
| Timeline |
| First Tractor |
| Textainer Group Holdings |
First Tractor and Textainer Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Tractor and Textainer Group
The main advantage of trading using opposite First Tractor and Textainer Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Tractor position performs unexpectedly, Textainer Group 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 Textainer Group will offset losses from the drop in Textainer Group's long position.| First Tractor vs. Ag Growth International | First Tractor vs. AmeraMex International | First Tractor vs. Arts Way Manufacturing Co | First Tractor vs. American Premium Water |
| Textainer Group vs. Buhler Industries | Textainer Group vs. Ag Growth International | Textainer Group vs. Grow Solutions Holdings | Textainer Group vs. American Premium Water |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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