Correlation Between TRANSILVANIA INVESTMENTS and GRUPUL INDUSTRIAL
Can any of the company-specific risk be diversified away by investing in both TRANSILVANIA INVESTMENTS and GRUPUL INDUSTRIAL 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 TRANSILVANIA INVESTMENTS and GRUPUL INDUSTRIAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TRANSILVANIA INVESTMENTS ALLIANCE and GRUPUL INDUSTRIAL ELECTROCONTACT, you can compare the effects of market volatilities on TRANSILVANIA INVESTMENTS and GRUPUL INDUSTRIAL 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 TRANSILVANIA INVESTMENTS with a short position of GRUPUL INDUSTRIAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of TRANSILVANIA INVESTMENTS and GRUPUL INDUSTRIAL.
Diversification Opportunities for TRANSILVANIA INVESTMENTS and GRUPUL INDUSTRIAL
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between TRANSILVANIA and GRUPUL is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding TRANSILVANIA INVESTMENTS ALLIA and GRUPUL INDUSTRIAL ELECTROCONTA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GRUPUL INDUSTRIAL and TRANSILVANIA INVESTMENTS 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 TRANSILVANIA INVESTMENTS ALLIANCE are associated (or correlated) with GRUPUL INDUSTRIAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GRUPUL INDUSTRIAL has no effect on the direction of TRANSILVANIA INVESTMENTS i.e., TRANSILVANIA INVESTMENTS and GRUPUL INDUSTRIAL go up and down completely randomly.
Pair Corralation between TRANSILVANIA INVESTMENTS and GRUPUL INDUSTRIAL
Assuming the 90 days trading horizon TRANSILVANIA INVESTMENTS ALLIANCE is expected to under-perform the GRUPUL INDUSTRIAL. But the stock apears to be less risky and, when comparing its historical volatility, TRANSILVANIA INVESTMENTS ALLIANCE is 1.56 times less risky than GRUPUL INDUSTRIAL. The stock trades about -0.07 of its potential returns per unit of risk. The GRUPUL INDUSTRIAL ELECTROCONTACT is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest 4.00 in GRUPUL INDUSTRIAL ELECTROCONTACT on August 28, 2024 and sell it today you would earn a total of 0.50 from holding GRUPUL INDUSTRIAL ELECTROCONTACT or generate 12.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
TRANSILVANIA INVESTMENTS ALLIA vs. GRUPUL INDUSTRIAL ELECTROCONTA
Performance |
| Timeline |
| TRANSILVANIA INVESTMENTS |
| GRUPUL INDUSTRIAL |
TRANSILVANIA INVESTMENTS and GRUPUL INDUSTRIAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TRANSILVANIA INVESTMENTS and GRUPUL INDUSTRIAL
The main advantage of trading using opposite TRANSILVANIA INVESTMENTS and GRUPUL INDUSTRIAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TRANSILVANIA INVESTMENTS position performs unexpectedly, GRUPUL INDUSTRIAL 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 GRUPUL INDUSTRIAL will offset losses from the drop in GRUPUL INDUSTRIAL's long position.| TRANSILVANIA INVESTMENTS vs. Bermas SA | TRANSILVANIA INVESTMENTS vs. Remarul 16 Februarie | TRANSILVANIA INVESTMENTS vs. Norofert SA | TRANSILVANIA INVESTMENTS vs. Biofarm Bucure |
| GRUPUL INDUSTRIAL vs. Bermas SA | GRUPUL INDUSTRIAL vs. Remarul 16 Februarie | GRUPUL INDUSTRIAL vs. Norofert SA | GRUPUL INDUSTRIAL vs. Biofarm Bucure |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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