Correlation Between Turquoise Hill and Inflection Point

Can any of the company-specific risk be diversified away by investing in both Turquoise Hill and Inflection Point 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 Turquoise Hill and Inflection Point into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Turquoise Hill Resources and Inflection Point Acquisition, you can compare the effects of market volatilities on Turquoise Hill and Inflection Point 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 Turquoise Hill with a short position of Inflection Point. Check out your portfolio center. Please also check ongoing floating volatility patterns of Turquoise Hill and Inflection Point.

Diversification Opportunities for Turquoise Hill and Inflection Point

-0.81

Correlation Coefficient

Turquoise Hill  Inflection Point

Pay attention - limited upside

The 3 months correlation between Turquoise and Inflection is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding Turquoise Hill Resources and Inflection Point Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inflection Point Acq and Turquoise Hill 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 Turquoise Hill Resources are associated (or correlated) with Inflection Point. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inflection Point Acq has no effect on the direction of Turquoise Hill i.e., Turquoise Hill and Inflection Point go up and down completely randomly.

Pair Corralation between Turquoise Hill and Inflection Point

If you would invest  1,075  in Inflection Point Acquisition on September 12, 2024 and sell it today you would earn a total of  415.00  from holding Inflection Point Acquisition or generate 38.6% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	0.0%
Values	Daily Returns

Turquoise Hill Resources  vs.  Inflection Point Acquisition

Turquoise Hill Resources

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Turquoise Hill Resources has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Turquoise Hill is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Inflection Point Acq

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Inflection Point Acquisition are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, Inflection Point unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Turquoise Hill and Inflection Point

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

The idea behind Turquoise Hill Resources and Inflection Point Acquisition 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.