Correlation Between TFI International and Inflection Point
Can any of the company-specific risk be diversified away by investing in both TFI International and Inflection Point 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 Inflection Point into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TFI International and Inflection Point Acquisition, you can compare the effects of market volatilities on TFI International and Inflection Point 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 Inflection Point. Check out your portfolio center. Please also check ongoing floating volatility patterns of TFI International and Inflection Point.
Diversification Opportunities for TFI International and Inflection Point
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between TFI and Inflection is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding TFI International and Inflection Point Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inflection Point Acq 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 Inflection Point. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inflection Point Acq has no effect on the direction of TFI International i.e., TFI International and Inflection Point go up and down completely randomly.
Pair Corralation between TFI International and Inflection Point
Given the investment horizon of 90 days TFI International is expected to generate 6.56 times more return on investment than Inflection Point. However, TFI International is 6.56 times more volatile than Inflection Point Acquisition. It trades about 0.06 of its potential returns per unit of risk. Inflection Point Acquisition is currently generating about 0.11 per unit of risk. If you would invest 13,345 in TFI International on September 3, 2024 and sell it today you would earn a total of 1,823 from holding TFI International or generate 13.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
TFI International vs. Inflection Point Acquisition
Performance |
| Timeline |
| TFI International |
| Inflection Point Acq |
TFI International and Inflection Point Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TFI International and Inflection Point
The main advantage of trading using opposite TFI International and Inflection Point positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TFI International position performs unexpectedly, Inflection Point 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 Inflection Point will offset losses from the drop in Inflection Point's long position.| TFI International vs. Old Dominion Freight | TFI International vs. ArcBest Corp | TFI International vs. Marten Transport | TFI International vs. Werner Enterprises |
| Inflection Point vs. Arrow Electronics | Inflection Point vs. BioNTech SE | Inflection Point vs. BJs Restaurants | Inflection Point vs. Yum Brands |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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