Correlation Between Transimex Transportation and Transport
Can any of the company-specific risk be diversified away by investing in both Transimex Transportation and Transport 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 Transimex Transportation and Transport into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Transimex Transportation JSC and Transport and Industry, you can compare the effects of market volatilities on Transimex Transportation and Transport 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 Transimex Transportation with a short position of Transport. Check out your portfolio center. Please also check ongoing floating volatility patterns of Transimex Transportation and Transport.
Diversification Opportunities for Transimex Transportation and Transport
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Transimex and Transport is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Transimex Transportation JSC and Transport and Industry in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Transport and Industry and Transimex Transportation 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 Transimex Transportation JSC are associated (or correlated) with Transport. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Transport and Industry has no effect on the direction of Transimex Transportation i.e., Transimex Transportation and Transport go up and down completely randomly.
Pair Corralation between Transimex Transportation and Transport
Assuming the 90 days trading horizon Transimex Transportation JSC is expected to generate 1.27 times more return on investment than Transport. However, Transimex Transportation is 1.27 times more volatile than Transport and Industry. It trades about -0.01 of its potential returns per unit of risk. Transport and Industry is currently generating about -0.21 per unit of risk. If you would invest 1,710,000 in Transimex Transportation JSC on September 2, 2024 and sell it today you would lose (10,000) from holding Transimex Transportation JSC or give up 0.58% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 63.64% |
| Values | Daily Returns |
Transimex Transportation JSC vs. Transport and Industry
Performance |
| Timeline |
| Transimex Transportation |
| Transport and Industry |
Transimex Transportation and Transport Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Transimex Transportation and Transport
The main advantage of trading using opposite Transimex Transportation and Transport positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Transimex Transportation position performs unexpectedly, Transport 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 Transport will offset losses from the drop in Transport's long position.| Transimex Transportation vs. Song Hong Garment | Transimex Transportation vs. Alphanam ME | Transimex Transportation vs. Hochiminh City Metal | Transimex Transportation vs. Atesco Industrial Cartering |
| Transport vs. Tienlen Steel Corp | Transport vs. PVI Reinsurance Corp | Transport vs. Vietnam National Reinsurance | Transport vs. CEO Group JSC |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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