Correlation Between Philip Morris and Thermedics
Can any of the company-specific risk be diversified away by investing in both Philip Morris and Thermedics 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 Philip Morris and Thermedics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Philip Morris International and Thermedics, you can compare the effects of market volatilities on Philip Morris and Thermedics 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 Philip Morris with a short position of Thermedics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Philip Morris and Thermedics.
Diversification Opportunities for Philip Morris and Thermedics
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Philip and Thermedics is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Philip Morris International and Thermedics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thermedics and Philip Morris 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 Philip Morris International are associated (or correlated) with Thermedics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thermedics has no effect on the direction of Philip Morris i.e., Philip Morris and Thermedics go up and down completely randomly.
Pair Corralation between Philip Morris and Thermedics
If you would invest 12,422 in Philip Morris International on September 13, 2024 and sell it today you would earn a total of 332.50 from holding Philip Morris International or generate 2.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Philip Morris International vs. Thermedics
Performance |
| Timeline |
| Philip Morris Intern |
| Thermedics |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Philip Morris and Thermedics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Philip Morris and Thermedics
The main advantage of trading using opposite Philip Morris and Thermedics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Philip Morris position performs unexpectedly, Thermedics 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 Thermedics will offset losses from the drop in Thermedics' long position.| Philip Morris vs. Turning Point Brands | Philip Morris vs. Imperial Brands PLC | Philip Morris vs. Kaival Brands Innovations | Philip Morris vs. PT Hanjaya Mandala |
| Thermedics vs. Universal | Thermedics vs. Molson Coors Brewing | Thermedics vs. Philip Morris International | Thermedics vs. ChampionX |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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