Correlation Between TriMas and O I
Can any of the company-specific risk be diversified away by investing in both TriMas and O I 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 TriMas and O I into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TriMas and O I Glass, you can compare the effects of market volatilities on TriMas and O I 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 TriMas with a short position of O I. Check out your portfolio center. Please also check ongoing floating volatility patterns of TriMas and O I.
Diversification Opportunities for TriMas and O I
Modest diversification
The 3 months correlation between TriMas and O I is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding TriMas and O I Glass in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on O I Glass and TriMas 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 TriMas are associated (or correlated) with O I. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of O I Glass has no effect on the direction of TriMas i.e., TriMas and O I go up and down completely randomly.
Pair Corralation between TriMas and O I
Considering the 90-day investment horizon TriMas is expected to generate 0.54 times more return on investment than O I. However, TriMas is 1.86 times less risky than O I. It trades about -0.37 of its potential returns per unit of risk. O I Glass is currently generating about -0.59 per unit of risk. If you would invest 2,638 in TriMas on September 28, 2024 and sell it today you would lose (179.00) from holding TriMas or give up 6.79% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
TriMas vs. O I Glass
Performance |
Timeline |
TriMas |
O I Glass |
TriMas and O I Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with TriMas and O I
The main advantage of trading using opposite TriMas and O I positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TriMas position performs unexpectedly, O I 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 O I will offset losses from the drop in O I's long position.TriMas vs. Greif Bros | TriMas vs. Karat Packaging | TriMas vs. Reynolds Consumer Products | TriMas vs. Silgan Holdings |
Check out your portfolio center.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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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