Correlation Between Travis Perkins and Antelope Enterprise

Can any of the company-specific risk be diversified away by investing in both Travis Perkins and Antelope Enterprise 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 Travis Perkins and Antelope Enterprise into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Travis Perkins PLC and Antelope Enterprise Holdings, you can compare the effects of market volatilities on Travis Perkins and Antelope Enterprise 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 Travis Perkins with a short position of Antelope Enterprise. Check out your portfolio center. Please also check ongoing floating volatility patterns of Travis Perkins and Antelope Enterprise.

Diversification Opportunities for Travis Perkins and Antelope Enterprise

0.5

Correlation Coefficient

Travis Perkins  Antelope Enterprise

Very weak diversification

The 3 months correlation between Travis and Antelope is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Travis Perkins PLC and Antelope Enterprise Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Antelope Enterprise and Travis Perkins 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 Travis Perkins PLC are associated (or correlated) with Antelope Enterprise. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Antelope Enterprise has no effect on the direction of Travis Perkins i.e., Travis Perkins and Antelope Enterprise go up and down completely randomly.

Pair Corralation between Travis Perkins and Antelope Enterprise

Assuming the 90 days horizon Travis Perkins PLC is expected to generate 0.26 times more return on investment than Antelope Enterprise. However, Travis Perkins PLC is 3.91 times less risky than Antelope Enterprise. It trades about -0.13 of its potential returns per unit of risk. Antelope Enterprise Holdings is currently generating about -0.28 per unit of risk. If you would invest  1,206  in Travis Perkins PLC on September 2, 2024 and sell it today you would lose (237.00) from holding Travis Perkins PLC or give up 19.65% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.46%
Values	Daily Returns

Travis Perkins PLC  vs.  Antelope Enterprise Holdings

Travis Perkins PLC

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Travis Perkins PLC has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's forward-looking signals remain fairly strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Antelope Enterprise

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Antelope Enterprise Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite abnormal performance in the last few months, the Stock's technical indicators remain quite persistent which may send shares a bit higher in January 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with Travis Perkins and Antelope Enterprise

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

The idea behind Travis Perkins PLC and Antelope Enterprise Holdings 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.