Correlation Between Touchstone International and Credit Suisse
Can any of the company-specific risk be diversified away by investing in both Touchstone International and Credit Suisse 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 Touchstone International and Credit Suisse into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Touchstone International Equity and Credit Suisse Managed, you can compare the effects of market volatilities on Touchstone International and Credit Suisse 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 Touchstone International with a short position of Credit Suisse. Check out your portfolio center. Please also check ongoing floating volatility patterns of Touchstone International and Credit Suisse.
Diversification Opportunities for Touchstone International and Credit Suisse
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Touchstone and Credit is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Touchstone International Equit and Credit Suisse Managed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Credit Suisse Managed and Touchstone 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 Touchstone International Equity are associated (or correlated) with Credit Suisse. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Credit Suisse Managed has no effect on the direction of Touchstone International i.e., Touchstone International and Credit Suisse go up and down completely randomly.
Pair Corralation between Touchstone International and Credit Suisse
Assuming the 90 days horizon Touchstone International Equity is expected to generate 0.93 times more return on investment than Credit Suisse. However, Touchstone International Equity is 1.07 times less risky than Credit Suisse. It trades about 0.05 of its potential returns per unit of risk. Credit Suisse Managed is currently generating about 0.01 per unit of risk. If you would invest 1,579 in Touchstone International Equity on September 13, 2024 and sell it today you would earn a total of 9.00 from holding Touchstone International Equity or generate 0.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Touchstone International Equit vs. Credit Suisse Managed
Performance |
| Timeline |
| Touchstone International |
| Credit Suisse Managed |
Touchstone International and Credit Suisse Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Touchstone International and Credit Suisse
The main advantage of trading using opposite Touchstone International and Credit Suisse positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Touchstone International position performs unexpectedly, Credit Suisse 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 Credit Suisse will offset losses from the drop in Credit Suisse's long position.| Touchstone International vs. Guidemark Smallmid Cap | Touchstone International vs. Glg Intl Small | Touchstone International vs. Cardinal Small Cap | Touchstone International vs. Small Pany Growth |
| Credit Suisse vs. Credit Suisse Floating | Credit Suisse vs. Credit Suisse Floating | Credit Suisse vs. Credit Suisse Modity | Credit Suisse vs. Credit Suisse Modity |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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