Correlation Between TAT Technologies and Iargento
Can any of the company-specific risk be diversified away by investing in both TAT Technologies and Iargento 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 Iargento into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TAT Technologies and Iargento Hi Tech, you can compare the effects of market volatilities on TAT Technologies and Iargento 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 Iargento. Check out your portfolio center. Please also check ongoing floating volatility patterns of TAT Technologies and Iargento.
Diversification Opportunities for TAT Technologies and Iargento
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between TAT and Iargento is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding TAT Technologies and Iargento Hi Tech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Iargento Hi Tech 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 Iargento. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Iargento Hi Tech has no effect on the direction of TAT Technologies i.e., TAT Technologies and Iargento go up and down completely randomly.
Pair Corralation between TAT Technologies and Iargento
Assuming the 90 days trading horizon TAT Technologies is expected to generate 24.84 times less return on investment than Iargento. But when comparing it to its historical volatility, TAT Technologies is 49.96 times less risky than Iargento. It trades about 0.21 of its potential returns per unit of risk. Iargento Hi Tech is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 5,140 in Iargento Hi Tech on August 25, 2024 and sell it today you would earn a total of 3,730 from holding Iargento Hi Tech or generate 72.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.52% |
| Values | Daily Returns |
TAT Technologies vs. Iargento Hi Tech
Performance |
| Timeline |
| TAT Technologies |
| Iargento Hi Tech |
TAT Technologies and Iargento Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TAT Technologies and Iargento
The main advantage of trading using opposite TAT Technologies and Iargento positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TAT Technologies position performs unexpectedly, Iargento 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 Iargento will offset losses from the drop in Iargento's long position.| TAT Technologies vs. Orbit Technologies | TAT Technologies vs. Tower Semiconductor | TAT Technologies vs. Elron Electronic Industries | TAT Technologies vs. Elbit Systems |
| Iargento vs. Clal Biotechnology Industries | Iargento vs. Menif Financial Services | Iargento vs. Unet Credit Finance | Iargento vs. Teuza A Fairchild |
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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