Correlation Between THiRA-UTECH and Intellian Technologies

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

By analyzing existing cross correlation between THiRA UTECH LTD and Intellian Technologies, you can compare the effects of market volatilities on THiRA-UTECH and Intellian 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 THiRA-UTECH with a short position of Intellian Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of THiRA-UTECH and Intellian Technologies.

Diversification Opportunities for THiRA-UTECH and Intellian Technologies

0.47

Correlation Coefficient

THiRA-UTECH  Intellian Technologies

Very weak diversification

The 3 months correlation between THiRA-UTECH and Intellian is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding THiRA UTECH LTD and Intellian Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intellian Technologies and THiRA-UTECH 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 THiRA UTECH LTD are associated (or correlated) with Intellian Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intellian Technologies has no effect on the direction of THiRA-UTECH i.e., THiRA-UTECH and Intellian Technologies go up and down completely randomly.

Pair Corralation between THiRA-UTECH and Intellian Technologies

Assuming the 90 days trading horizon THiRA UTECH LTD is expected to generate 0.73 times more return on investment than Intellian Technologies. However, THiRA UTECH LTD is 1.37 times less risky than Intellian Technologies. It trades about -0.03 of its potential returns per unit of risk. Intellian Technologies is currently generating about -0.1 per unit of risk. If you would invest  511,000  in THiRA UTECH LTD on September 14, 2024 and sell it today you would lose (35,500) from holding THiRA UTECH LTD or give up 6.95% of portfolio value over 90 days.

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

THiRA UTECH LTD  vs.  Intellian Technologies

THiRA UTECH LTD

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days THiRA UTECH LTD has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, THiRA-UTECH is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Intellian Technologies

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Intellian Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with THiRA-UTECH and Intellian Technologies

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

The idea behind THiRA UTECH LTD and Intellian 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.