Correlation Between Triton International and THERMO
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By analyzing existing cross correlation between Triton International Limited and THERMO FISHER SCIENTIFIC, you can compare the effects of market volatilities on Triton International and THERMO 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 Triton International with a short position of THERMO. Check out your portfolio center. Please also check ongoing floating volatility patterns of Triton International and THERMO.
Diversification Opportunities for Triton International and THERMO
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Triton and THERMO is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Triton International Limited and THERMO FISHER SCIENTIFIC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on THERMO FISHER SCIENTIFIC and Triton International 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 Triton International Limited are associated (or correlated) with THERMO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of THERMO FISHER SCIENTIFIC has no effect on the direction of Triton International i.e., Triton International and THERMO go up and down completely randomly.
Pair Corralation between Triton International and THERMO
Assuming the 90 days trading horizon Triton International Limited is expected to generate 0.46 times more return on investment than THERMO. However, Triton International Limited is 2.16 times less risky than THERMO. It trades about 0.06 of its potential returns per unit of risk. THERMO FISHER SCIENTIFIC is currently generating about 0.02 per unit of risk. If you would invest 2,229 in Triton International Limited on September 14, 2024 and sell it today you would earn a total of 247.00 from holding Triton International Limited or generate 11.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 77.02% |
| Values | Daily Returns |
Triton International Limited vs. THERMO FISHER SCIENTIFIC
Performance |
| Timeline |
| Triton International |
| THERMO FISHER SCIENTIFIC |
Triton International and THERMO Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Triton International and THERMO
The main advantage of trading using opposite Triton International and THERMO positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Triton International position performs unexpectedly, THERMO 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 THERMO will offset losses from the drop in THERMO's long position.The idea behind Triton International Limited and THERMO FISHER SCIENTIFIC pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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