Correlation Between TAT Technologies and Analyst IMS
Can any of the company-specific risk be diversified away by investing in both TAT Technologies and Analyst IMS 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 TAT Technologies and Analyst IMS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TAT Technologies and Analyst IMS Investment, you can compare the effects of market volatilities on TAT Technologies and Analyst IMS 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 TAT Technologies with a short position of Analyst IMS. Check out your portfolio center. Please also check ongoing floating volatility patterns of TAT Technologies and Analyst IMS.
Diversification Opportunities for TAT Technologies and Analyst IMS
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between TAT and Analyst is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding TAT Technologies and Analyst IMS Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Analyst IMS Investment and TAT Technologies 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 TAT Technologies are associated (or correlated) with Analyst IMS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Analyst IMS Investment has no effect on the direction of TAT Technologies i.e., TAT Technologies and Analyst IMS go up and down completely randomly.
Pair Corralation between TAT Technologies and Analyst IMS
Assuming the 90 days trading horizon TAT Technologies is expected to generate 4.12 times more return on investment than Analyst IMS. However, TAT Technologies is 4.12 times more volatile than Analyst IMS Investment. It trades about 0.27 of its potential returns per unit of risk. Analyst IMS Investment is currently generating about 0.48 per unit of risk. If you would invest 692,000 in TAT Technologies on September 1, 2024 and sell it today you would earn a total of 132,000 from holding TAT Technologies or generate 19.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
TAT Technologies vs. Analyst IMS Investment
Performance |
| Timeline |
| TAT Technologies |
| Analyst IMS Investment |
TAT Technologies and Analyst IMS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TAT Technologies and Analyst IMS
The main advantage of trading using opposite TAT Technologies and Analyst IMS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TAT Technologies position performs unexpectedly, Analyst IMS 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 Analyst IMS will offset losses from the drop in Analyst IMS's long position.| TAT Technologies vs. Orbit Technologies | TAT Technologies vs. Tower Semiconductor | TAT Technologies vs. Elron Electronic Industries | TAT Technologies vs. Elbit Systems |
| Analyst IMS vs. TAT Technologies | Analyst IMS vs. Clal Biotechnology Industries | Analyst IMS vs. Spuntech | Analyst IMS vs. Elbit Medical Technologies |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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