Correlation Between Gladstone Investment and TTM TECHNOLOGIES

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

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

Diversification Opportunities for Gladstone Investment and TTM TECHNOLOGIES

-0.05

Correlation Coefficient

Gladstone Investment  TTM TECHNOLOGIES

Good diversification

The 3 months correlation between Gladstone and TTM is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Gladstone Investment and TTM TECHNOLOGIES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TTM TECHNOLOGIES and Gladstone Investment 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 Gladstone Investment are associated (or correlated) with TTM TECHNOLOGIES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TTM TECHNOLOGIES has no effect on the direction of Gladstone Investment i.e., Gladstone Investment and TTM TECHNOLOGIES go up and down completely randomly.

Pair Corralation between Gladstone Investment and TTM TECHNOLOGIES

Assuming the 90 days horizon Gladstone Investment is expected to generate 78.21 times less return on investment than TTM TECHNOLOGIES. But when comparing it to its historical volatility, Gladstone Investment is 1.63 times less risky than TTM TECHNOLOGIES. It trades about 0.01 of its potential returns per unit of risk. TTM TECHNOLOGIES is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest  1,720  in TTM TECHNOLOGIES on October 23, 2024 and sell it today you would earn a total of  760.00  from holding TTM TECHNOLOGIES or generate 44.19% return on investment over 90 days.

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

Gladstone Investment  vs.  TTM TECHNOLOGIES

Gladstone Investment

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Gladstone Investment has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Gladstone Investment is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.

TTM TECHNOLOGIES

Risk-Adjusted Performance

18 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in TTM TECHNOLOGIES are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, TTM TECHNOLOGIES unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Gladstone Investment and TTM TECHNOLOGIES

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

The idea behind Gladstone Investment and TTM TECHNOLOGIES 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.