Correlation Between Tabcorp Holdings and First Graphene
Can any of the company-specific risk be diversified away by investing in both Tabcorp Holdings and First Graphene 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 Tabcorp Holdings and First Graphene into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tabcorp Holdings and First Graphene, you can compare the effects of market volatilities on Tabcorp Holdings and First Graphene 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 Tabcorp Holdings with a short position of First Graphene. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tabcorp Holdings and First Graphene.
Diversification Opportunities for Tabcorp Holdings and First Graphene
-0.79 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Tabcorp and First is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding Tabcorp Holdings and First Graphene in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Graphene and Tabcorp Holdings 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 Tabcorp Holdings are associated (or correlated) with First Graphene. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Graphene has no effect on the direction of Tabcorp Holdings i.e., Tabcorp Holdings and First Graphene go up and down completely randomly.
Pair Corralation between Tabcorp Holdings and First Graphene
Assuming the 90 days trading horizon Tabcorp Holdings is expected to generate 0.8 times more return on investment than First Graphene. However, Tabcorp Holdings is 1.25 times less risky than First Graphene. It trades about 0.0 of its potential returns per unit of risk. First Graphene is currently generating about -0.1 per unit of risk. If you would invest 60.00 in Tabcorp Holdings on September 5, 2024 and sell it today you would lose (5.00) from holding Tabcorp Holdings or give up 8.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.22% |
| Values | Daily Returns |
Tabcorp Holdings vs. First Graphene
Performance |
| Timeline |
| Tabcorp Holdings |
| First Graphene |
Tabcorp Holdings and First Graphene Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tabcorp Holdings and First Graphene
The main advantage of trading using opposite Tabcorp Holdings and First Graphene positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tabcorp Holdings position performs unexpectedly, First Graphene 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 First Graphene will offset losses from the drop in First Graphene's long position.| Tabcorp Holdings vs. Aneka Tambang Tbk | Tabcorp Holdings vs. BHP Group Limited | Tabcorp Holdings vs. Commonwealth Bank of | Tabcorp Holdings vs. Commonwealth Bank of |
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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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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