Correlation Between International Consolidated and TELES Informationstech
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By analyzing existing cross correlation between International Consolidated Airlines and TELES Informationstechnologien AG, you can compare the effects of market volatilities on International Consolidated and TELES Informationstech 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 International Consolidated with a short position of TELES Informationstech. Check out your portfolio center. Please also check ongoing floating volatility patterns of International Consolidated and TELES Informationstech.
Diversification Opportunities for International Consolidated and TELES Informationstech
-0.85 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between International and TELES is -0.85. Overlapping area represents the amount of risk that can be diversified away by holding International Consolidated Air and TELES Informationstechnologien in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TELES Informationstech and International Consolidated 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 International Consolidated Airlines are associated (or correlated) with TELES Informationstech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TELES Informationstech has no effect on the direction of International Consolidated i.e., International Consolidated and TELES Informationstech go up and down completely randomly.
Pair Corralation between International Consolidated and TELES Informationstech
Assuming the 90 days horizon International Consolidated Airlines is expected to generate 0.44 times more return on investment than TELES Informationstech. However, International Consolidated Airlines is 2.29 times less risky than TELES Informationstech. It trades about 0.55 of its potential returns per unit of risk. TELES Informationstechnologien AG is currently generating about -0.08 per unit of risk. If you would invest 301.00 in International Consolidated Airlines on September 24, 2024 and sell it today you would earn a total of 67.00 from holding International Consolidated Airlines or generate 22.26% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
International Consolidated Air vs. TELES Informationstechnologien
Performance |
Timeline |
International Consolidated |
TELES Informationstech |
International Consolidated and TELES Informationstech Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with International Consolidated and TELES Informationstech
The main advantage of trading using opposite International Consolidated and TELES Informationstech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if International Consolidated position performs unexpectedly, TELES Informationstech 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 TELES Informationstech will offset losses from the drop in TELES Informationstech's long position.The idea behind International Consolidated Airlines and TELES Informationstechnologien AG 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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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