Correlation Between THRACE PLASTICS and Gaztransport Technigaz
Can any of the company-specific risk be diversified away by investing in both THRACE PLASTICS and Gaztransport Technigaz 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 THRACE PLASTICS and Gaztransport Technigaz into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between THRACE PLASTICS and Gaztransport Technigaz SA, you can compare the effects of market volatilities on THRACE PLASTICS and Gaztransport Technigaz 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 THRACE PLASTICS with a short position of Gaztransport Technigaz. Check out your portfolio center. Please also check ongoing floating volatility patterns of THRACE PLASTICS and Gaztransport Technigaz.
Diversification Opportunities for THRACE PLASTICS and Gaztransport Technigaz
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between THRACE and Gaztransport is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding THRACE PLASTICS and Gaztransport Technigaz SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gaztransport Technigaz and THRACE PLASTICS 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 THRACE PLASTICS are associated (or correlated) with Gaztransport Technigaz. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gaztransport Technigaz has no effect on the direction of THRACE PLASTICS i.e., THRACE PLASTICS and Gaztransport Technigaz go up and down completely randomly.
Pair Corralation between THRACE PLASTICS and Gaztransport Technigaz
Assuming the 90 days trading horizon THRACE PLASTICS is expected to generate 0.81 times more return on investment than Gaztransport Technigaz. However, THRACE PLASTICS is 1.24 times less risky than Gaztransport Technigaz. It trades about 0.17 of its potential returns per unit of risk. Gaztransport Technigaz SA is currently generating about 0.11 per unit of risk. If you would invest 360.00 in THRACE PLASTICS on October 14, 2024 and sell it today you would earn a total of 55.00 from holding THRACE PLASTICS or generate 15.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
THRACE PLASTICS vs. Gaztransport Technigaz SA
Performance |
| Timeline |
| THRACE PLASTICS |
| Gaztransport Technigaz |
THRACE PLASTICS and Gaztransport Technigaz Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with THRACE PLASTICS and Gaztransport Technigaz
The main advantage of trading using opposite THRACE PLASTICS and Gaztransport Technigaz positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if THRACE PLASTICS position performs unexpectedly, Gaztransport Technigaz 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 Gaztransport Technigaz will offset losses from the drop in Gaztransport Technigaz's long position.| THRACE PLASTICS vs. ARDAGH METAL PACDL 0001 | THRACE PLASTICS vs. Daito Trust Construction | THRACE PLASTICS vs. MAGNUM MINING EXP | THRACE PLASTICS vs. TITAN MACHINERY |
| Gaztransport Technigaz vs. Yanzhou Coal Mining | Gaztransport Technigaz vs. NURAN WIRELESS INC | Gaztransport Technigaz vs. BJs Restaurants | Gaztransport Technigaz vs. Darden Restaurants |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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