Correlation Between Triad Group and AMG Advanced
Can any of the company-specific risk be diversified away by investing in both Triad Group and AMG Advanced 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 Triad Group and AMG Advanced into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Triad Group PLC and AMG Advanced Metallurgical, you can compare the effects of market volatilities on Triad Group and AMG Advanced 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 Triad Group with a short position of AMG Advanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of Triad Group and AMG Advanced.
Diversification Opportunities for Triad Group and AMG Advanced
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between Triad and AMG is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Triad Group PLC and AMG Advanced Metallurgical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AMG Advanced Metallu and Triad Group 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 Triad Group PLC are associated (or correlated) with AMG Advanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AMG Advanced Metallu has no effect on the direction of Triad Group i.e., Triad Group and AMG Advanced go up and down completely randomly.
Pair Corralation between Triad Group and AMG Advanced
Assuming the 90 days trading horizon Triad Group PLC is expected to generate 0.97 times more return on investment than AMG Advanced. However, Triad Group PLC is 1.03 times less risky than AMG Advanced. It trades about 0.11 of its potential returns per unit of risk. AMG Advanced Metallurgical is currently generating about -0.03 per unit of risk. If you would invest 18,864 in Triad Group PLC on November 3, 2024 and sell it today you would earn a total of 16,636 from holding Triad Group PLC or generate 88.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Triad Group PLC vs. AMG Advanced Metallurgical
Performance |
| Timeline |
| Triad Group PLC |
| AMG Advanced Metallu |
Triad Group and AMG Advanced Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Triad Group and AMG Advanced
The main advantage of trading using opposite Triad Group and AMG Advanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Triad Group position performs unexpectedly, AMG Advanced 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 AMG Advanced will offset losses from the drop in AMG Advanced's long position.| Triad Group vs. Roper Technologies | Triad Group vs. Zegona Communications Plc | Triad Group vs. Gamma Communications PLC | Triad Group vs. Xeros Technology Group |
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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 Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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