Correlation Between TRON and SGA Solutions
Can any of the company-specific risk be diversified away by investing in both TRON and SGA Solutions 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 TRON and SGA Solutions into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TRON and SGA Solutions CoLtd, you can compare the effects of market volatilities on TRON and SGA Solutions 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 TRON with a short position of SGA Solutions. Check out your portfolio center. Please also check ongoing floating volatility patterns of TRON and SGA Solutions.
Diversification Opportunities for TRON and SGA Solutions
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between TRON and SGA is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding TRON and SGA Solutions CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SGA Solutions CoLtd and TRON 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 TRON are associated (or correlated) with SGA Solutions. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SGA Solutions CoLtd has no effect on the direction of TRON i.e., TRON and SGA Solutions go up and down completely randomly.
Pair Corralation between TRON and SGA Solutions
Assuming the 90 days trading horizon TRON is expected to generate 3.97 times less return on investment than SGA Solutions. In addition to that, TRON is 1.67 times more volatile than SGA Solutions CoLtd. It trades about 0.02 of its total potential returns per unit of risk. SGA Solutions CoLtd is currently generating about 0.13 per unit of volatility. If you would invest 46,400 in SGA Solutions CoLtd on October 30, 2024 and sell it today you would earn a total of 2,500 from holding SGA Solutions CoLtd or generate 5.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.0% |
| Values | Daily Returns |
TRON vs. SGA Solutions CoLtd
Performance |
| Timeline |
| TRON |
| SGA Solutions CoLtd |
TRON and SGA Solutions Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TRON and SGA Solutions
The main advantage of trading using opposite TRON and SGA Solutions positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TRON position performs unexpectedly, SGA Solutions 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 SGA Solutions will offset losses from the drop in SGA Solutions' long position.The idea behind TRON and SGA Solutions CoLtd 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.| SGA Solutions vs. Samsung Electronics Co | SGA Solutions vs. Samsung Electronics Co | SGA Solutions vs. SK Hynix | SGA Solutions vs. HMM Co |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
Other Complementary Tools
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device |