Correlation Between Tangerine Beach and Trans Asia
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By analyzing existing cross correlation between Tangerine Beach Hotels and Trans Asia Hotels, you can compare the effects of market volatilities on Tangerine Beach and Trans Asia 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 Tangerine Beach with a short position of Trans Asia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tangerine Beach and Trans Asia.
Diversification Opportunities for Tangerine Beach and Trans Asia
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Tangerine and Trans is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Tangerine Beach Hotels and Trans Asia Hotels in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trans Asia Hotels and Tangerine Beach 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 Tangerine Beach Hotels are associated (or correlated) with Trans Asia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trans Asia Hotels has no effect on the direction of Tangerine Beach i.e., Tangerine Beach and Trans Asia go up and down completely randomly.
Pair Corralation between Tangerine Beach and Trans Asia
Assuming the 90 days trading horizon Tangerine Beach Hotels is expected to generate 1.28 times more return on investment than Trans Asia. However, Tangerine Beach is 1.28 times more volatile than Trans Asia Hotels. It trades about 0.02 of its potential returns per unit of risk. Trans Asia Hotels is currently generating about 0.01 per unit of risk. If you would invest 5,900 in Tangerine Beach Hotels on August 27, 2024 and sell it today you would earn a total of 500.00 from holding Tangerine Beach Hotels or generate 8.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 83.62% |
| Values | Daily Returns |
Tangerine Beach Hotels vs. Trans Asia Hotels
Performance |
| Timeline |
| Tangerine Beach Hotels |
| Trans Asia Hotels |
Tangerine Beach and Trans Asia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tangerine Beach and Trans Asia
The main advantage of trading using opposite Tangerine Beach and Trans Asia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tangerine Beach position performs unexpectedly, Trans Asia 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 Trans Asia will offset losses from the drop in Trans Asia's long position.| Tangerine Beach vs. BROWNS INVESTMENTS PLC | Tangerine Beach vs. Sampath Bank PLC | Tangerine Beach vs. RENUKA FOODS PLC | Tangerine Beach vs. SEYLAN BANK PLC |
| Trans Asia vs. Union Bank | Trans Asia vs. HVA Foods PLC | Trans Asia vs. Amana Bank | Trans Asia vs. Hatton National Bank |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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