Correlation Between Platinum Investment and T Mobile
Can any of the company-specific risk be diversified away by investing in both Platinum Investment and T Mobile 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 Platinum Investment and T Mobile into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Platinum Investment Management and T Mobile, you can compare the effects of market volatilities on Platinum Investment and T Mobile 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 Platinum Investment with a short position of T Mobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of Platinum Investment and T Mobile.
Diversification Opportunities for Platinum Investment and T Mobile
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Platinum and TM5 is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Platinum Investment Management and T Mobile in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on T Mobile and Platinum Investment 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 Platinum Investment Management are associated (or correlated) with T Mobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of T Mobile has no effect on the direction of Platinum Investment i.e., Platinum Investment and T Mobile go up and down completely randomly.
Pair Corralation between Platinum Investment and T Mobile
Assuming the 90 days horizon Platinum Investment Management is expected to under-perform the T Mobile. In addition to that, Platinum Investment is 1.0 times more volatile than T Mobile. It trades about -0.39 of its total potential returns per unit of risk. T Mobile is currently generating about 0.28 per unit of volatility. If you would invest 21,100 in T Mobile on August 29, 2024 and sell it today you would earn a total of 1,940 from holding T Mobile or generate 9.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Platinum Investment Management vs. T Mobile
Performance |
| Timeline |
| Platinum Investment |
| T Mobile |
Platinum Investment and T Mobile Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Platinum Investment and T Mobile
The main advantage of trading using opposite Platinum Investment and T Mobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Platinum Investment position performs unexpectedly, T Mobile 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 T Mobile will offset losses from the drop in T Mobile's long position.| Platinum Investment vs. PICKN PAY STORES | Platinum Investment vs. Qurate Retail Series | Platinum Investment vs. Caseys General Stores | Platinum Investment vs. Retail Estates NV |
| T Mobile vs. Solstad Offshore ASA | T Mobile vs. SIEM OFFSHORE NEW | T Mobile vs. United Natural Foods | T Mobile vs. Canadian Utilities Limited |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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