Correlation Between Trematon Capital and Investec
Can any of the company-specific risk be diversified away by investing in both Trematon Capital and Investec 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 Trematon Capital and Investec into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Trematon Capital Investments and Investec, you can compare the effects of market volatilities on Trematon Capital and Investec 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 Trematon Capital with a short position of Investec. Check out your portfolio center. Please also check ongoing floating volatility patterns of Trematon Capital and Investec.
Diversification Opportunities for Trematon Capital and Investec
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Trematon and Investec is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Trematon Capital Investments and Investec in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Investec and Trematon Capital 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 Trematon Capital Investments are associated (or correlated) with Investec. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Investec has no effect on the direction of Trematon Capital i.e., Trematon Capital and Investec go up and down completely randomly.
Pair Corralation between Trematon Capital and Investec
Assuming the 90 days trading horizon Trematon Capital Investments is expected to generate 1.53 times more return on investment than Investec. However, Trematon Capital is 1.53 times more volatile than Investec. It trades about -0.01 of its potential returns per unit of risk. Investec is currently generating about -0.09 per unit of risk. If you would invest 23,600 in Trematon Capital Investments on August 30, 2024 and sell it today you would lose (300.00) from holding Trematon Capital Investments or give up 1.27% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Trematon Capital Investments vs. Investec
Performance |
| Timeline |
| Trematon Capital Inv |
| Investec |
Trematon Capital and Investec Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Trematon Capital and Investec
The main advantage of trading using opposite Trematon Capital and Investec positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Trematon Capital position performs unexpectedly, Investec 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 Investec will offset losses from the drop in Investec's long position.| Trematon Capital vs. Lighthouse Capital | Trematon Capital vs. Growthpoint Properties | Trematon Capital vs. AfricaRhodium ETF | Trematon Capital vs. CoreShares Preference Share |
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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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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