Correlation Between TFI International and Aldel Financial
Can any of the company-specific risk be diversified away by investing in both TFI International and Aldel Financial 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 TFI International and Aldel Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TFI International and Aldel Financial II, you can compare the effects of market volatilities on TFI International and Aldel Financial 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 TFI International with a short position of Aldel Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of TFI International and Aldel Financial.
Diversification Opportunities for TFI International and Aldel Financial
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between TFI and Aldel is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding TFI International and Aldel Financial II in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aldel Financial II and TFI International 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 TFI International are associated (or correlated) with Aldel Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aldel Financial II has no effect on the direction of TFI International i.e., TFI International and Aldel Financial go up and down completely randomly.
Pair Corralation between TFI International and Aldel Financial
Given the investment horizon of 90 days TFI International is expected to generate 17.48 times more return on investment than Aldel Financial. However, TFI International is 17.48 times more volatile than Aldel Financial II. It trades about 0.05 of its potential returns per unit of risk. Aldel Financial II is currently generating about 0.11 per unit of risk. If you would invest 9,958 in TFI International on August 25, 2024 and sell it today you would earn a total of 4,915 from holding TFI International or generate 49.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 5.04% |
| Values | Daily Returns |
TFI International vs. Aldel Financial II
Performance |
| Timeline |
| TFI International |
| Aldel Financial II |
TFI International and Aldel Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TFI International and Aldel Financial
The main advantage of trading using opposite TFI International and Aldel Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TFI International position performs unexpectedly, Aldel Financial 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 Aldel Financial will offset losses from the drop in Aldel Financial's long position.| TFI International vs. Old Dominion Freight | TFI International vs. ArcBest Corp | TFI International vs. Werner Enterprises | TFI International vs. Knight Transportation |
| Aldel Financial vs. Voyager Acquisition Corp | Aldel Financial vs. dMY Squared Technology | Aldel Financial vs. YHN Acquisition I | Aldel Financial vs. Vine Hill Capital |
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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