Correlation Between Tel Instrument and National Presto
Can any of the company-specific risk be diversified away by investing in both Tel Instrument and National Presto 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 Tel Instrument and National Presto into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tel Instrument Electronics Corp and National Presto Industries, you can compare the effects of market volatilities on Tel Instrument and National Presto 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 Tel Instrument with a short position of National Presto. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tel Instrument and National Presto.
Diversification Opportunities for Tel Instrument and National Presto
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between Tel and National is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Tel Instrument Electronics Cor and National Presto Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on National Presto Indu and Tel Instrument 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 Tel Instrument Electronics Corp are associated (or correlated) with National Presto. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of National Presto Indu has no effect on the direction of Tel Instrument i.e., Tel Instrument and National Presto go up and down completely randomly.
Pair Corralation between Tel Instrument and National Presto
If you would invest 7,458 in National Presto Industries on August 29, 2024 and sell it today you would earn a total of 400.00 from holding National Presto Industries or generate 5.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 4.35% |
| Values | Daily Returns |
Tel Instrument Electronics Cor vs. National Presto Industries
Performance |
| Timeline |
| Tel Instrument Elect |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| National Presto Indu |
Tel Instrument and National Presto Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tel Instrument and National Presto
The main advantage of trading using opposite Tel Instrument and National Presto positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tel Instrument position performs unexpectedly, National Presto 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 National Presto will offset losses from the drop in National Presto's long position.| Tel Instrument vs. 808 Renewable Energy | Tel Instrument vs. Austal Limited | Tel Instrument vs. Sky Harbour Group | Tel Instrument vs. VirTra Inc |
| National Presto vs. Park Electrochemical | National Presto vs. Ducommun Incorporated | National Presto vs. Innovative Solutions and | National Presto vs. VSE Corporation |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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