Correlation Between Trio Tech and RIOLN

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

By analyzing existing cross correlation between Trio Tech International and RIOLN 275 02 NOV 51, you can compare the effects of market volatilities on Trio Tech and RIOLN 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 Trio Tech with a short position of RIOLN. Check out your portfolio center. Please also check ongoing floating volatility patterns of Trio Tech and RIOLN.

Diversification Opportunities for Trio Tech and RIOLN

-0.41

Correlation Coefficient

Trio Tech  RIOLN

Very good diversification

The 3 months correlation between Trio and RIOLN is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Trio Tech International and RIOLN 275 02 NOV 51 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RIOLN 275 02 and Trio Tech 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 Trio Tech International are associated (or correlated) with RIOLN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RIOLN 275 02 has no effect on the direction of Trio Tech i.e., Trio Tech and RIOLN go up and down completely randomly.

Pair Corralation between Trio Tech and RIOLN

Considering the 90-day investment horizon Trio Tech International is expected to under-perform the RIOLN. In addition to that, Trio Tech is 1.74 times more volatile than RIOLN 275 02 NOV 51. It trades about -0.23 of its total potential returns per unit of risk. RIOLN 275 02 NOV 51 is currently generating about -0.15 per unit of volatility. If you would invest  6,524  in RIOLN 275 02 NOV 51 on September 28, 2024 and sell it today you would lose (240.00) from holding RIOLN 275 02 NOV 51 or give up 3.68% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	95.24%
Values	Daily Returns

Trio Tech International  vs.  RIOLN 275 02 NOV 51

Trio Tech International

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Trio Tech International are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Trio Tech unveiled solid returns over the last few months and may actually be approaching a breakup point.

RIOLN 275 02

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days RIOLN 275 02 NOV 51 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest unfluctuating performance, the Bond's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for RIOLN 275 02 NOV 51 investors.

Pair Trading with Trio Tech and RIOLN

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

The idea behind Trio Tech International and RIOLN 275 02 NOV 51 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.