Correlation Between Tomra Systems and China Everbright
Can any of the company-specific risk be diversified away by investing in both Tomra Systems and China Everbright 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 Tomra Systems and China Everbright into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tomra Systems ASA and China Everbright Environment, you can compare the effects of market volatilities on Tomra Systems and China Everbright 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 Tomra Systems with a short position of China Everbright. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tomra Systems and China Everbright.
Diversification Opportunities for Tomra Systems and China Everbright
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Tomra and China is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Tomra Systems ASA and China Everbright Environment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Everbright Env and Tomra Systems 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 Tomra Systems ASA are associated (or correlated) with China Everbright. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Everbright Env has no effect on the direction of Tomra Systems i.e., Tomra Systems and China Everbright go up and down completely randomly.
Pair Corralation between Tomra Systems and China Everbright
If you would invest 39.00 in China Everbright Environment on August 28, 2024 and sell it today you would earn a total of 0.00 from holding China Everbright Environment or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 1.59% |
| Values | Daily Returns |
Tomra Systems ASA vs. China Everbright Environment
Performance |
| Timeline |
| Tomra Systems ASA |
| China Everbright Env |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Tomra Systems and China Everbright Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tomra Systems and China Everbright
The main advantage of trading using opposite Tomra Systems and China Everbright positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tomra Systems position performs unexpectedly, China Everbright 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 China Everbright will offset losses from the drop in China Everbright's long position.| Tomra Systems vs. Republic Services | Tomra Systems vs. Waste Connections | Tomra Systems vs. Clean Harbors | Tomra Systems vs. Gfl Environmental Holdings |
| China Everbright vs. Perma Fix Environmental Svcs | China Everbright vs. Casella Waste Systems | China Everbright vs. Clean Harbors | China Everbright vs. Montrose Environmental Grp |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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