Correlation Between TDG Global and Plastic Additives
Can any of the company-specific risk be diversified away by investing in both TDG Global and Plastic Additives 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 TDG Global and Plastic Additives into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TDG Global Investment and Plastic Additives JSC, you can compare the effects of market volatilities on TDG Global and Plastic Additives 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 TDG Global with a short position of Plastic Additives. Check out your portfolio center. Please also check ongoing floating volatility patterns of TDG Global and Plastic Additives.
Diversification Opportunities for TDG Global and Plastic Additives
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between TDG and Plastic is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding TDG Global Investment and Plastic Additives JSC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Plastic Additives JSC and TDG Global 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 TDG Global Investment are associated (or correlated) with Plastic Additives. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Plastic Additives JSC has no effect on the direction of TDG Global i.e., TDG Global and Plastic Additives go up and down completely randomly.
Pair Corralation between TDG Global and Plastic Additives
Assuming the 90 days trading horizon TDG Global is expected to generate 4.1 times less return on investment than Plastic Additives. But when comparing it to its historical volatility, TDG Global Investment is 1.55 times less risky than Plastic Additives. It trades about 0.01 of its potential returns per unit of risk. Plastic Additives JSC is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 820,000 in Plastic Additives JSC on September 12, 2024 and sell it today you would earn a total of 200,000 from holding Plastic Additives JSC or generate 24.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 94.51% |
| Values | Daily Returns |
TDG Global Investment vs. Plastic Additives JSC
Performance |
| Timeline |
| TDG Global Investment |
| Plastic Additives JSC |
TDG Global and Plastic Additives Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TDG Global and Plastic Additives
The main advantage of trading using opposite TDG Global and Plastic Additives positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TDG Global position performs unexpectedly, Plastic Additives 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 Plastic Additives will offset losses from the drop in Plastic Additives' long position.| TDG Global vs. FIT INVEST JSC | TDG Global vs. Damsan JSC | TDG Global vs. An Phat Plastic | TDG Global vs. Alphanam ME |
| Plastic Additives vs. Vina2 Investment and | Plastic Additives vs. Hai An Transport | Plastic Additives vs. South Basic Chemicals | Plastic Additives vs. Transport and Industry |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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