Correlation Between Progate and TUL
Can any of the company-specific risk be diversified away by investing in both Progate and TUL 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 Progate and TUL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Progate Group and TUL Corporation, you can compare the effects of market volatilities on Progate and TUL 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 Progate with a short position of TUL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Progate and TUL.
Diversification Opportunities for Progate and TUL
Excellent diversification
The 3 months correlation between Progate and TUL is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Progate Group and TUL Corp. in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TUL Corporation and Progate 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 Progate Group are associated (or correlated) with TUL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TUL Corporation has no effect on the direction of Progate i.e., Progate and TUL go up and down completely randomly.
Pair Corralation between Progate and TUL
Assuming the 90 days trading horizon Progate Group is expected to generate 1.48 times more return on investment than TUL. However, Progate is 1.48 times more volatile than TUL Corporation. It trades about 0.08 of its potential returns per unit of risk. TUL Corporation is currently generating about -0.21 per unit of risk. If you would invest 15,550 in Progate Group on September 17, 2024 and sell it today you would earn a total of 700.00 from holding Progate Group or generate 4.5% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Progate Group vs. TUL Corp.
Performance |
Timeline |
Progate Group |
TUL Corporation |
Progate and TUL Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Progate and TUL
The main advantage of trading using opposite Progate and TUL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Progate position performs unexpectedly, TUL 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 TUL will offset losses from the drop in TUL's long position.Progate vs. Taiwan Semiconductor Manufacturing | Progate vs. Hon Hai Precision | Progate vs. MediaTek | Progate vs. Chunghwa Telecom Co |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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