Correlation Between Tetragon Financial and Marks
Can any of the company-specific risk be diversified away by investing in both Tetragon Financial and Marks 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 Tetragon Financial and Marks into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tetragon Financial Group and Marks and Spencer, you can compare the effects of market volatilities on Tetragon Financial and Marks 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 Tetragon Financial with a short position of Marks. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tetragon Financial and Marks.
Diversification Opportunities for Tetragon Financial and Marks
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Tetragon and Marks is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Tetragon Financial Group and Marks and Spencer in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marks and Spencer and Tetragon Financial 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 Tetragon Financial Group are associated (or correlated) with Marks. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marks and Spencer has no effect on the direction of Tetragon Financial i.e., Tetragon Financial and Marks go up and down completely randomly.
Pair Corralation between Tetragon Financial and Marks
Assuming the 90 days trading horizon Tetragon Financial Group is expected to generate 0.72 times more return on investment than Marks. However, Tetragon Financial Group is 1.38 times less risky than Marks. It trades about 0.16 of its potential returns per unit of risk. Marks and Spencer is currently generating about 0.06 per unit of risk. If you would invest 968.00 in Tetragon Financial Group on October 16, 2024 and sell it today you would earn a total of 627.00 from holding Tetragon Financial Group or generate 64.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tetragon Financial Group vs. Marks and Spencer
Performance |
| Timeline |
| Tetragon Financial |
| Marks and Spencer |
Tetragon Financial and Marks Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tetragon Financial and Marks
The main advantage of trading using opposite Tetragon Financial and Marks positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tetragon Financial position performs unexpectedly, Marks 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 Marks will offset losses from the drop in Marks' long position.| Tetragon Financial vs. SupplyMe Capital PLC | Tetragon Financial vs. SM Energy Co | Tetragon Financial vs. FuelCell Energy | Tetragon Financial vs. Grand Vision Media |
| Marks vs. Gaztransport et Technigaz | Marks vs. Verizon Communications | Marks vs. Home Depot | Marks vs. Cairo Communication SpA |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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