Correlation Between Micro Leasing and TISCO Financial
Can any of the company-specific risk be diversified away by investing in both Micro Leasing and TISCO Financial 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 Micro Leasing and TISCO Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Micro Leasing Public and TISCO Financial Group, you can compare the effects of market volatilities on Micro Leasing and TISCO Financial 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 Micro Leasing with a short position of TISCO Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Micro Leasing and TISCO Financial.
Diversification Opportunities for Micro Leasing and TISCO Financial
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Micro and TISCO is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Micro Leasing Public and TISCO Financial Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TISCO Financial Group and Micro Leasing 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 Micro Leasing Public are associated (or correlated) with TISCO Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TISCO Financial Group has no effect on the direction of Micro Leasing i.e., Micro Leasing and TISCO Financial go up and down completely randomly.
Pair Corralation between Micro Leasing and TISCO Financial
Assuming the 90 days trading horizon Micro Leasing Public is expected to under-perform the TISCO Financial. In addition to that, Micro Leasing is 7.23 times more volatile than TISCO Financial Group. It trades about -0.34 of its total potential returns per unit of risk. TISCO Financial Group is currently generating about -0.03 per unit of volatility. If you would invest 9,650 in TISCO Financial Group on August 30, 2024 and sell it today you would lose (50.00) from holding TISCO Financial Group or give up 0.52% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 97.62% |
| Values | Daily Returns |
Micro Leasing Public vs. TISCO Financial Group
Performance |
| Timeline |
| Micro Leasing Public |
| TISCO Financial Group |
Micro Leasing and TISCO Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Micro Leasing and TISCO Financial
The main advantage of trading using opposite Micro Leasing and TISCO Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Micro Leasing position performs unexpectedly, TISCO Financial 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 TISCO Financial will offset losses from the drop in TISCO Financial's long position.| Micro Leasing vs. Amanah Leasing Public | Micro Leasing vs. Infraset Public | Micro Leasing vs. JMT Network Services |
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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 Transaction History module to view history of all your transactions and understand their impact on performance.
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