Correlation Between TransUnion and Mistras

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

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

Diversification Opportunities for TransUnion and Mistras

0.4

Correlation Coefficient

TransUnion  Mistras

Very weak diversification

The 3 months correlation between TransUnion and Mistras is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding TransUnion and Mistras Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mistras Group and TransUnion 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 TransUnion are associated (or correlated) with Mistras. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mistras Group has no effect on the direction of TransUnion i.e., TransUnion and Mistras go up and down completely randomly.

Pair Corralation between TransUnion and Mistras

Considering the 90-day investment horizon TransUnion is expected to generate 0.44 times more return on investment than Mistras. However, TransUnion is 2.26 times less risky than Mistras. It trades about 0.05 of its potential returns per unit of risk. Mistras Group is currently generating about -0.05 per unit of risk. If you would invest  9,540  in TransUnion on September 5, 2024 and sell it today you would earn a total of  463.00  from holding TransUnion or generate 4.85% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

TransUnion  vs.  Mistras Group

TransUnion

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in TransUnion are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, TransUnion is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Mistras Group

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Mistras Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's technical and fundamental indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Pair Trading with TransUnion and Mistras

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

The idea behind TransUnion and Mistras Group 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.