Correlation Between TFI International and Evolution Mining
Can any of the company-specific risk be diversified away by investing in both TFI International and Evolution Mining 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 Evolution Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TFI International and Evolution Mining, you can compare the effects of market volatilities on TFI International and Evolution Mining 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 Evolution Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of TFI International and Evolution Mining.
Diversification Opportunities for TFI International and Evolution Mining
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between TFI and Evolution is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding TFI International and Evolution Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Evolution Mining 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 Evolution Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Evolution Mining has no effect on the direction of TFI International i.e., TFI International and Evolution Mining go up and down completely randomly.
Pair Corralation between TFI International and Evolution Mining
Given the investment horizon of 90 days TFI International is expected to generate 2.81 times less return on investment than Evolution Mining. But when comparing it to its historical volatility, TFI International is 2.22 times less risky than Evolution Mining. It trades about 0.04 of its potential returns per unit of risk. Evolution Mining is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 215.00 in Evolution Mining on September 4, 2024 and sell it today you would earn a total of 107.00 from holding Evolution Mining or generate 49.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 97.24% |
| Values | Daily Returns |
TFI International vs. Evolution Mining
Performance |
| Timeline |
| TFI International |
| Evolution Mining |
TFI International and Evolution Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TFI International and Evolution Mining
The main advantage of trading using opposite TFI International and Evolution Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TFI International position performs unexpectedly, Evolution Mining 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 Evolution Mining will offset losses from the drop in Evolution Mining's long position.| TFI International vs. Old Dominion Freight | TFI International vs. ArcBest Corp | TFI International vs. Marten Transport | TFI International vs. Werner Enterprises |
| Evolution Mining vs. Harmony Gold Mining | Evolution Mining vs. SPACE | Evolution Mining vs. T Rowe Price | Evolution Mining vs. Ampleforth |
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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