Correlation Between TPG Telecom and Peel Mining

Can any of the company-specific risk be diversified away by investing in both TPG Telecom and Peel Mining 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 TPG Telecom and Peel Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between TPG Telecom and Peel Mining, you can compare the effects of market volatilities on TPG Telecom and Peel Mining 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 TPG Telecom with a short position of Peel Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of TPG Telecom and Peel Mining.

Diversification Opportunities for TPG Telecom and Peel Mining

-0.32

Correlation Coefficient

TPG Telecom  Peel Mining

Very good diversification

The 3 months correlation between TPG and Peel is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding TPG Telecom and Peel Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Peel Mining and TPG Telecom 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 TPG Telecom are associated (or correlated) with Peel Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Peel Mining has no effect on the direction of TPG Telecom i.e., TPG Telecom and Peel Mining go up and down completely randomly.

Pair Corralation between TPG Telecom and Peel Mining

Assuming the 90 days trading horizon TPG Telecom is expected to under-perform the Peel Mining. But the stock apears to be less risky and, when comparing its historical volatility, TPG Telecom is 3.69 times less risky than Peel Mining. The stock trades about -0.14 of its potential returns per unit of risk. The Peel Mining is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  11.00  in Peel Mining on September 28, 2024 and sell it today you would earn a total of  1.00  from holding Peel Mining or generate 9.09% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

TPG Telecom  vs.  Peel Mining

TPG Telecom

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days TPG Telecom has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's technical and fundamental indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Peel Mining

Risk-Adjusted Performance

4 of 100

Very Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Peel Mining are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Peel Mining unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with TPG Telecom and Peel Mining

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

The idea behind TPG Telecom and Peel Mining 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.