Correlation Between Tatton Asset and Marks
Can any of the company-specific risk be diversified away by investing in both Tatton Asset and Marks 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 Tatton Asset and Marks into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tatton Asset Management and Marks and Spencer, you can compare the effects of market volatilities on Tatton Asset and Marks 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 Tatton Asset with a short position of Marks. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tatton Asset and Marks.
Diversification Opportunities for Tatton Asset and Marks
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between Tatton and Marks is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Tatton Asset Management and Marks and Spencer in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marks and Spencer and Tatton Asset 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 Tatton Asset Management are associated (or correlated) with Marks. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marks and Spencer has no effect on the direction of Tatton Asset i.e., Tatton Asset and Marks go up and down completely randomly.
Pair Corralation between Tatton Asset and Marks
Assuming the 90 days trading horizon Tatton Asset Management is expected to under-perform the Marks. But the stock apears to be less risky and, when comparing its historical volatility, Tatton Asset Management is 1.04 times less risky than Marks. The stock trades about -0.02 of its potential returns per unit of risk. The Marks and Spencer is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 37,801 in Marks and Spencer on September 23, 2024 and sell it today you would earn a total of 139.00 from holding Marks and Spencer or generate 0.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tatton Asset Management vs. Marks and Spencer
Performance |
| Timeline |
| Tatton Asset Management |
| Marks and Spencer |
Tatton Asset and Marks Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tatton Asset and Marks
The main advantage of trading using opposite Tatton Asset and Marks positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tatton Asset position performs unexpectedly, Marks 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 Marks will offset losses from the drop in Marks' long position.| Tatton Asset vs. Samsung Electronics Co | Tatton Asset vs. Samsung Electronics Co | Tatton Asset vs. Hyundai Motor | Tatton Asset vs. Toyota Motor Corp |
| Marks vs. Jupiter Fund Management | Marks vs. Hansa Investment | Marks vs. Tatton Asset Management | Marks vs. Coor Service Management |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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