Correlation Between Chlitina Holding and TCI

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

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

Diversification Opportunities for Chlitina Holding and TCI

0.86

Correlation Coefficient

Chlitina Holding  TCI

Very poor diversification

The 3 months correlation between Chlitina and TCI is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Chlitina Holding and TCI Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TCI Co and Chlitina Holding 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 Chlitina Holding are associated (or correlated) with TCI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TCI Co has no effect on the direction of Chlitina Holding i.e., Chlitina Holding and TCI go up and down completely randomly.

Pair Corralation between Chlitina Holding and TCI

Assuming the 90 days trading horizon Chlitina Holding is expected to generate 1.71 times less return on investment than TCI. But when comparing it to its historical volatility, Chlitina Holding is 1.28 times less risky than TCI. It trades about 0.12 of its potential returns per unit of risk. TCI Co is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest  12,300  in TCI Co on December 30, 2024 and sell it today you would earn a total of  2,700  from holding TCI Co or generate 21.95% return on investment over 90 days.

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

Chlitina Holding  vs.  TCI Co

Chlitina Holding

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Chlitina Holding are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Chlitina Holding showed solid returns over the last few months and may actually be approaching a breakup point.

TCI Co

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in TCI Co are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, TCI showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Chlitina Holding and TCI

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

The idea behind Chlitina Holding and TCI 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 Stocks Directory module to find actively traded stocks across global markets.