Correlation Between Titan Company and Yuanta Securities

Can any of the company-specific risk be diversified away by investing in both Titan Company and Yuanta Securities 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 Titan Company and Yuanta Securities into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Titan Company Limited and Yuanta Securities Investment, you can compare the effects of market volatilities on Titan Company and Yuanta Securities 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 Titan Company with a short position of Yuanta Securities. Check out your portfolio center. Please also check ongoing floating volatility patterns of Titan Company and Yuanta Securities.

Diversification Opportunities for Titan Company and Yuanta Securities

0.38

Correlation Coefficient

Titan Company  Yuanta Securities

Weak diversification

The 3 months correlation between Titan and Yuanta is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Titan Company Limited and Yuanta Securities Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yuanta Securities and Titan Company 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 Titan Company Limited are associated (or correlated) with Yuanta Securities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yuanta Securities has no effect on the direction of Titan Company i.e., Titan Company and Yuanta Securities go up and down completely randomly.

Pair Corralation between Titan Company and Yuanta Securities

Assuming the 90 days trading horizon Titan Company is expected to generate 1.09 times less return on investment than Yuanta Securities. In addition to that, Titan Company is 1.3 times more volatile than Yuanta Securities Investment. It trades about 0.12 of its total potential returns per unit of risk. Yuanta Securities Investment is currently generating about 0.16 per unit of volatility. If you would invest  921.00  in Yuanta Securities Investment on September 5, 2024 and sell it today you would earn a total of  39.00  from holding Yuanta Securities Investment or generate 4.23% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	91.3%
Values	Daily Returns

Titan Company Limited  vs.  Yuanta Securities Investment

Titan Limited

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Titan Company Limited has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's basic indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

Yuanta Securities

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Yuanta Securities Investment has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Yuanta Securities is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Titan Company and Yuanta Securities

The main advantage of trading using opposite Titan Company and Yuanta Securities positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Titan Company position performs unexpectedly, Yuanta Securities 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 Yuanta Securities will offset losses from the drop in Yuanta Securities' long position.

The idea behind Titan Company Limited and Yuanta Securities Investment 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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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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.