Correlation Between Trellidor Holdings and CA Sales

Can any of the company-specific risk be diversified away by investing in both Trellidor Holdings and CA Sales 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 Trellidor Holdings and CA Sales into the same portfolio, which is an essential part of the fundamental portfolio management process.

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

Diversification Opportunities for Trellidor Holdings and CA Sales

-0.54

Correlation Coefficient

Trellidor Holdings  CA Sales

Excellent diversification

The 3 months correlation between Trellidor and CAA is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Trellidor Holdings and CA Sales Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CA Sales Holdings and Trellidor Holdings 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 Trellidor Holdings are associated (or correlated) with CA Sales. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CA Sales Holdings has no effect on the direction of Trellidor Holdings i.e., Trellidor Holdings and CA Sales go up and down completely randomly.

Pair Corralation between Trellidor Holdings and CA Sales

Assuming the 90 days trading horizon Trellidor Holdings is expected to under-perform the CA Sales. In addition to that, Trellidor Holdings is 1.12 times more volatile than CA Sales Holdings. It trades about -0.11 of its total potential returns per unit of risk. CA Sales Holdings is currently generating about 0.08 per unit of volatility. If you would invest  145,500  in CA Sales Holdings on September 14, 2024 and sell it today you would earn a total of  14,500  from holding CA Sales Holdings or generate 9.97% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	98.44%
Values	Daily Returns

Trellidor Holdings  vs.  CA Sales Holdings

Trellidor Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Trellidor Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's technical and fundamental indicators remain rather sound which may send shares a bit higher in January 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

CA Sales Holdings

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in CA Sales Holdings are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak technical and fundamental indicators, CA Sales may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Trellidor Holdings and CA Sales

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

The idea behind Trellidor Holdings and CA Sales 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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.