Correlation Between Turvo International and Sanyang

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

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

Diversification Opportunities for Turvo International and Sanyang

-0.19

Correlation Coefficient

Turvo International  Sanyang

Good diversification

The 3 months correlation between Turvo and Sanyang is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Turvo International Co and Sanyang Motor Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sanyang Motor and Turvo International 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 Turvo International Co are associated (or correlated) with Sanyang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sanyang Motor has no effect on the direction of Turvo International i.e., Turvo International and Sanyang go up and down completely randomly.

Pair Corralation between Turvo International and Sanyang

Assuming the 90 days trading horizon Turvo International Co is expected to generate 2.3 times more return on investment than Sanyang. However, Turvo International is 2.3 times more volatile than Sanyang Motor Co. It trades about 0.13 of its potential returns per unit of risk. Sanyang Motor Co is currently generating about -0.08 per unit of risk. If you would invest  13,388  in Turvo International Co on September 24, 2024 and sell it today you would earn a total of  8,662  from holding Turvo International Co or generate 64.7% return on investment over 90 days.

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

Turvo International Co  vs.  Sanyang Motor Co

Turvo International

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Turvo International Co are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Turvo International showed solid returns over the last few months and may actually be approaching a breakup point.

Sanyang Motor

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Sanyang Motor Co has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest abnormal performance, the Stock's basic indicators remain stable and the latest fuss on Wall Street may also be a sign of long-term gains for the venture sophisticated investors.

Pair Trading with Turvo International and Sanyang

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

The idea behind Turvo International Co and Sanyang Motor Co 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.