Correlation Between Teledyne Technologies and Bancroft Fund
Can any of the company-specific risk be diversified away by investing in both Teledyne Technologies and Bancroft Fund 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 Teledyne Technologies and Bancroft Fund into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Teledyne Technologies Incorporated and Bancroft Fund, you can compare the effects of market volatilities on Teledyne Technologies and Bancroft Fund 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 Teledyne Technologies with a short position of Bancroft Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Teledyne Technologies and Bancroft Fund.
Diversification Opportunities for Teledyne Technologies and Bancroft Fund
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Teledyne and Bancroft is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Teledyne Technologies Incorpor and Bancroft Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bancroft Fund and Teledyne 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 Teledyne Technologies Incorporated are associated (or correlated) with Bancroft Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bancroft Fund has no effect on the direction of Teledyne Technologies i.e., Teledyne Technologies and Bancroft Fund go up and down completely randomly.
Pair Corralation between Teledyne Technologies and Bancroft Fund
Considering the 90-day investment horizon Teledyne Technologies Incorporated is expected to generate 3.79 times more return on investment than Bancroft Fund. However, Teledyne Technologies is 3.79 times more volatile than Bancroft Fund. It trades about 0.21 of its potential returns per unit of risk. Bancroft Fund is currently generating about -0.07 per unit of risk. If you would invest 45,532 in Teledyne Technologies Incorporated on September 1, 2024 and sell it today you would earn a total of 2,994 from holding Teledyne Technologies Incorporated or generate 6.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Teledyne Technologies Incorpor vs. Bancroft Fund
Performance |
| Timeline |
| Teledyne Technologies |
| Bancroft Fund |
Teledyne Technologies and Bancroft Fund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Teledyne Technologies and Bancroft Fund
The main advantage of trading using opposite Teledyne Technologies and Bancroft Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Teledyne Technologies position performs unexpectedly, Bancroft Fund 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 Bancroft Fund will offset losses from the drop in Bancroft Fund's long position.| Teledyne Technologies vs. Vontier Corp | Teledyne Technologies vs. ESCO Technologies | Teledyne Technologies vs. MKS Instruments | Teledyne Technologies vs. Sensata Technologies Holding |
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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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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