Correlation Between Teradata Corp and GreenX Metals
Can any of the company-specific risk be diversified away by investing in both Teradata Corp and GreenX Metals 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 Teradata Corp and GreenX Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Teradata Corp and GreenX Metals, you can compare the effects of market volatilities on Teradata Corp and GreenX Metals 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 Teradata Corp with a short position of GreenX Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Teradata Corp and GreenX Metals.
Diversification Opportunities for Teradata Corp and GreenX Metals
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Teradata and GreenX is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Teradata Corp and GreenX Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GreenX Metals and Teradata Corp 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 Teradata Corp are associated (or correlated) with GreenX Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GreenX Metals has no effect on the direction of Teradata Corp i.e., Teradata Corp and GreenX Metals go up and down completely randomly.
Pair Corralation between Teradata Corp and GreenX Metals
Assuming the 90 days trading horizon Teradata Corp is expected to generate 0.47 times more return on investment than GreenX Metals. However, Teradata Corp is 2.11 times less risky than GreenX Metals. It trades about 0.11 of its potential returns per unit of risk. GreenX Metals is currently generating about 0.02 per unit of risk. If you would invest 2,845 in Teradata Corp on September 13, 2024 and sell it today you would earn a total of 409.00 from holding Teradata Corp or generate 14.38% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 96.92% |
Values | Daily Returns |
Teradata Corp vs. GreenX Metals
Performance |
Timeline |
Teradata Corp |
GreenX Metals |
Teradata Corp and GreenX Metals Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Teradata Corp and GreenX Metals
The main advantage of trading using opposite Teradata Corp and GreenX Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Teradata Corp position performs unexpectedly, GreenX Metals 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 GreenX Metals will offset losses from the drop in GreenX Metals' long position.Teradata Corp vs. Datagroup SE | Teradata Corp vs. Ebro Foods | Teradata Corp vs. Take Two Interactive Software | Teradata Corp vs. Scandinavian Tobacco Group |
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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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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