Correlation Between Teradyne and Gestamp Automocin
Can any of the company-specific risk be diversified away by investing in both Teradyne and Gestamp Automocin 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 Teradyne and Gestamp Automocin into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Teradyne and Gestamp Automocin SA, you can compare the effects of market volatilities on Teradyne and Gestamp Automocin 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 Teradyne with a short position of Gestamp Automocin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Teradyne and Gestamp Automocin.
Diversification Opportunities for Teradyne and Gestamp Automocin
-0.77 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Teradyne and Gestamp is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Teradyne and Gestamp Automocin SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gestamp Automocin and Teradyne 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 Teradyne are associated (or correlated) with Gestamp Automocin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gestamp Automocin has no effect on the direction of Teradyne i.e., Teradyne and Gestamp Automocin go up and down completely randomly.
Pair Corralation between Teradyne and Gestamp Automocin
Assuming the 90 days horizon Teradyne is expected to under-perform the Gestamp Automocin. In addition to that, Teradyne is 1.24 times more volatile than Gestamp Automocin SA. It trades about -0.03 of its total potential returns per unit of risk. Gestamp Automocin SA is currently generating about -0.01 per unit of volatility. If you would invest 259.00 in Gestamp Automocin SA on November 2, 2024 and sell it today you would lose (12.00) from holding Gestamp Automocin SA or give up 4.63% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Teradyne vs. Gestamp Automocin SA
Performance |
| Timeline |
| Teradyne |
| Gestamp Automocin |
Teradyne and Gestamp Automocin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Teradyne and Gestamp Automocin
The main advantage of trading using opposite Teradyne and Gestamp Automocin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Teradyne position performs unexpectedly, Gestamp Automocin 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 Gestamp Automocin will offset losses from the drop in Gestamp Automocin's long position.| Teradyne vs. Federal Agricultural Mortgage | Teradyne vs. Titan Machinery | Teradyne vs. Nippon Steel | Teradyne vs. Granite Construction |
| Gestamp Automocin vs. Take Two Interactive Software | Gestamp Automocin vs. Kingdee International Software | Gestamp Automocin vs. USU Software AG | Gestamp Automocin vs. FORMPIPE SOFTWARE AB |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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