Correlation Between TPI Polene and Premier Technology
Can any of the company-specific risk be diversified away by investing in both TPI Polene and Premier Technology 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 TPI Polene and Premier Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TPI Polene Power and Premier Technology Public, you can compare the effects of market volatilities on TPI Polene and Premier Technology 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 TPI Polene with a short position of Premier Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of TPI Polene and Premier Technology.
Diversification Opportunities for TPI Polene and Premier Technology
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between TPI and Premier is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding TPI Polene Power and Premier Technology Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Premier Technology Public and TPI Polene 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 TPI Polene Power are associated (or correlated) with Premier Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Premier Technology Public has no effect on the direction of TPI Polene i.e., TPI Polene and Premier Technology go up and down completely randomly.
Pair Corralation between TPI Polene and Premier Technology
Assuming the 90 days trading horizon TPI Polene Power is expected to under-perform the Premier Technology. But the stock apears to be less risky and, when comparing its historical volatility, TPI Polene Power is 1.34 times less risky than Premier Technology. The stock trades about -0.15 of its potential returns per unit of risk. The Premier Technology Public is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 945.00 in Premier Technology Public on September 12, 2024 and sell it today you would earn a total of 0.00 from holding Premier Technology Public or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
TPI Polene Power vs. Premier Technology Public
Performance |
| Timeline |
| TPI Polene Power |
| Premier Technology Public |
TPI Polene and Premier Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TPI Polene and Premier Technology
The main advantage of trading using opposite TPI Polene and Premier Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TPI Polene position performs unexpectedly, Premier Technology 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 Premier Technology will offset losses from the drop in Premier Technology's long position.| TPI Polene vs. WHA Public | TPI Polene vs. Global Power Synergy | TPI Polene vs. Bangkok Expressway and | TPI Polene vs. BGrimm Power Public |
| Premier Technology vs. KCE Electronics Public | Premier Technology vs. Land and Houses | Premier Technology vs. Delta Electronics Public | Premier Technology vs. The Siam Cement |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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