Correlation Between TTG Fintech and Iluka Resources
Can any of the company-specific risk be diversified away by investing in both TTG Fintech and Iluka Resources 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 TTG Fintech and Iluka Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TTG Fintech and Iluka Resources, you can compare the effects of market volatilities on TTG Fintech and Iluka Resources 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 TTG Fintech with a short position of Iluka Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of TTG Fintech and Iluka Resources.
Diversification Opportunities for TTG Fintech and Iluka Resources
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between TTG and Iluka is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding TTG Fintech and Iluka Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Iluka Resources and TTG Fintech 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 TTG Fintech are associated (or correlated) with Iluka Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Iluka Resources has no effect on the direction of TTG Fintech i.e., TTG Fintech and Iluka Resources go up and down completely randomly.
Pair Corralation between TTG Fintech and Iluka Resources
Assuming the 90 days trading horizon TTG Fintech is expected to generate 1.84 times more return on investment than Iluka Resources. However, TTG Fintech is 1.84 times more volatile than Iluka Resources. It trades about -0.04 of its potential returns per unit of risk. Iluka Resources is currently generating about -0.07 per unit of risk. If you would invest 0.60 in TTG Fintech on September 12, 2024 and sell it today you would lose (0.10) from holding TTG Fintech or give up 16.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
TTG Fintech vs. Iluka Resources
Performance |
| Timeline |
| TTG Fintech |
| Iluka Resources |
TTG Fintech and Iluka Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TTG Fintech and Iluka Resources
The main advantage of trading using opposite TTG Fintech and Iluka Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TTG Fintech position performs unexpectedly, Iluka Resources 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 Iluka Resources will offset losses from the drop in Iluka Resources' long position.| TTG Fintech vs. Aneka Tambang Tbk | TTG Fintech vs. Commonwealth Bank of | TTG Fintech vs. ANZ Group Holdings | TTG Fintech vs. National Australia Bank |
| Iluka Resources vs. Northern Star Resources | Iluka Resources vs. Evolution Mining | Iluka Resources vs. Bluescope Steel | Iluka Resources vs. Sandfire Resources NL |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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