Correlation Between Selan Exploration and Touchwood Entertainment
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By analyzing existing cross correlation between Selan Exploration Technology and Touchwood Entertainment Limited, you can compare the effects of market volatilities on Selan Exploration and Touchwood Entertainment 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 Selan Exploration with a short position of Touchwood Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Selan Exploration and Touchwood Entertainment.
Diversification Opportunities for Selan Exploration and Touchwood Entertainment
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Selan and Touchwood is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Selan Exploration Technology and Touchwood Entertainment Limite in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Touchwood Entertainment and Selan Exploration 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 Selan Exploration Technology are associated (or correlated) with Touchwood Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Touchwood Entertainment has no effect on the direction of Selan Exploration i.e., Selan Exploration and Touchwood Entertainment go up and down completely randomly.
Pair Corralation between Selan Exploration and Touchwood Entertainment
Assuming the 90 days trading horizon Selan Exploration Technology is expected to under-perform the Touchwood Entertainment. But the stock apears to be less risky and, when comparing its historical volatility, Selan Exploration Technology is 1.25 times less risky than Touchwood Entertainment. The stock trades about -0.28 of its potential returns per unit of risk. The Touchwood Entertainment Limited is currently generating about -0.07 of returns per unit of risk over similar time horizon. If you would invest 13,613 in Touchwood Entertainment Limited on October 30, 2024 and sell it today you would lose (1,764) from holding Touchwood Entertainment Limited or give up 12.96% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Selan Exploration Technology vs. Touchwood Entertainment Limite
Performance |
| Timeline |
| Selan Exploration |
| Touchwood Entertainment |
Selan Exploration and Touchwood Entertainment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Selan Exploration and Touchwood Entertainment
The main advantage of trading using opposite Selan Exploration and Touchwood Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Selan Exploration position performs unexpectedly, Touchwood Entertainment 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 Touchwood Entertainment will offset losses from the drop in Touchwood Entertainment's long position.| Selan Exploration vs. Tamilnad Mercantile Bank | Selan Exploration vs. Silver Touch Technologies | Selan Exploration vs. NRB Industrial Bearings | Selan Exploration vs. BF 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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