Correlation Between TELE2 -B- and TRAVEL +
Can any of the company-specific risk be diversified away by investing in both TELE2 -B- and TRAVEL + 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 TELE2 -B- and TRAVEL + into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TELE2 B and TRAVEL LEISURE DL 01, you can compare the effects of market volatilities on TELE2 -B- and TRAVEL + 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 TELE2 -B- with a short position of TRAVEL +. Check out your portfolio center. Please also check ongoing floating volatility patterns of TELE2 -B- and TRAVEL +.
Diversification Opportunities for TELE2 -B- and TRAVEL +
Average diversification
The 3 months correlation between TELE2 and TRAVEL is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding TELE2 B and TRAVEL LEISURE DL 01 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TRAVEL LEISURE DL and TELE2 -B- 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 TELE2 B are associated (or correlated) with TRAVEL +. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TRAVEL LEISURE DL has no effect on the direction of TELE2 -B- i.e., TELE2 -B- and TRAVEL + go up and down completely randomly.
Pair Corralation between TELE2 -B- and TRAVEL +
Assuming the 90 days trading horizon TELE2 B is expected to generate 2.94 times more return on investment than TRAVEL +. However, TELE2 -B- is 2.94 times more volatile than TRAVEL LEISURE DL 01. It trades about 0.1 of its potential returns per unit of risk. TRAVEL LEISURE DL 01 is currently generating about 0.05 per unit of risk. If you would invest 110.00 in TELE2 B on October 23, 2024 and sell it today you would earn a total of 857.00 from holding TELE2 B or generate 779.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
TELE2 B vs. TRAVEL LEISURE DL 01
Performance |
| Timeline |
| TELE2 -B- |
| TRAVEL LEISURE DL |
TELE2 -B- and TRAVEL + Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TELE2 -B- and TRAVEL +
The main advantage of trading using opposite TELE2 -B- and TRAVEL + positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TELE2 -B- position performs unexpectedly, TRAVEL + 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 TRAVEL + will offset losses from the drop in TRAVEL +'s long position.| TELE2 -B- vs. Cairo Communication SpA | TELE2 -B- vs. SOCKET MOBILE NEW | TELE2 -B- vs. Entravision Communications | TELE2 -B- vs. Ribbon Communications |
| TRAVEL + vs. TRIPCOM GROUP DL 00125 | TRAVEL + vs. TUI AG | TRAVEL + vs. MakeMyTrip Limited | TRAVEL + vs. FOSTOURGRP EO 0001 |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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