Correlation Between Titan Company and Grupa KTY

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Titan Company and Grupa KTY 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 Titan Company and Grupa KTY into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Titan Company Limited and Grupa KTY SA, you can compare the effects of market volatilities on Titan Company and Grupa KTY 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 Titan Company with a short position of Grupa KTY. Check out your portfolio center. Please also check ongoing floating volatility patterns of Titan Company and Grupa KTY.

Diversification Opportunities for Titan Company and Grupa KTY

0.71
  Correlation Coefficient

Poor diversification

The 3 months correlation between Titan and Grupa is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Titan Company Limited and Grupa KTY SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grupa KTY SA and Titan Company 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 Titan Company Limited are associated (or correlated) with Grupa KTY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grupa KTY SA has no effect on the direction of Titan Company i.e., Titan Company and Grupa KTY go up and down completely randomly.

Pair Corralation between Titan Company and Grupa KTY

Assuming the 90 days trading horizon Titan Company is expected to generate 1.45 times less return on investment than Grupa KTY. But when comparing it to its historical volatility, Titan Company Limited is 1.35 times less risky than Grupa KTY. It trades about 0.14 of its potential returns per unit of risk. Grupa KTY SA is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest  67,000  in Grupa KTY SA on September 6, 2024 and sell it today you would earn a total of  4,200  from holding Grupa KTY SA or generate 6.27% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy95.45%
ValuesDaily Returns

Titan Company Limited  vs.  Grupa KTY SA

 Performance 
       Timeline  
Titan Limited 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Titan Company Limited has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's basic indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.
Grupa KTY SA 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Grupa KTY SA has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Grupa KTY is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Titan Company and Grupa KTY Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Titan Company and Grupa KTY

The main advantage of trading using opposite Titan Company and Grupa KTY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Titan Company position performs unexpectedly, Grupa KTY 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 Grupa KTY will offset losses from the drop in Grupa KTY's long position.
The idea behind Titan Company Limited and Grupa KTY SA pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.

Other Complementary Tools

Aroon Oscillator
Analyze current equity momentum using Aroon Oscillator and other momentum ratios
Price Ceiling Movement
Calculate and plot Price Ceiling Movement for different equity instruments
Stock Tickers
Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites
FinTech Suite
Use AI to screen and filter profitable investment opportunities
Odds Of Bankruptcy
Get analysis of equity chance of financial distress in the next 2 years