Correlation Between Centaurus Metals and TTG Fintech

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

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

Diversification Opportunities for Centaurus Metals and TTG Fintech

-0.36

Correlation Coefficient

Centaurus Metals  TTG Fintech

Very good diversification

The 3 months correlation between Centaurus and TTG is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Centaurus Metals and TTG Fintech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TTG Fintech and Centaurus Metals 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 Centaurus Metals are associated (or correlated) with TTG Fintech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TTG Fintech has no effect on the direction of Centaurus Metals i.e., Centaurus Metals and TTG Fintech go up and down completely randomly.

Pair Corralation between Centaurus Metals and TTG Fintech

Assuming the 90 days trading horizon Centaurus Metals is expected to under-perform the TTG Fintech. But the stock apears to be less risky and, when comparing its historical volatility, Centaurus Metals is 2.97 times less risky than TTG Fintech. The stock trades about -0.07 of its potential returns per unit of risk. The TTG Fintech is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest  0.50  in TTG Fintech on October 15, 2024 and sell it today you would earn a total of  0.20  from holding TTG Fintech or generate 40.0% return on investment over 90 days.

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

Centaurus Metals  vs.  TTG Fintech

Centaurus Metals

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Centaurus Metals has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's primary indicators remain comparatively stable which may send shares a bit higher in February 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

TTG Fintech

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in TTG Fintech are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain fundamental indicators, TTG Fintech unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Centaurus Metals and TTG Fintech

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

The idea behind Centaurus Metals and TTG Fintech 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.