Correlation Between Sao Ta and Tng Investment

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

By analyzing existing cross correlation between Sao Ta Foods and Tng Investment And, you can compare the effects of market volatilities on Sao Ta and Tng Investment 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 Sao Ta with a short position of Tng Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sao Ta and Tng Investment.

Diversification Opportunities for Sao Ta and Tng Investment

0.12

Correlation Coefficient

Sao Ta  Tng Investment

Average diversification

The 3 months correlation between Sao and Tng is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Sao Ta Foods and Tng Investment And in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tng Investment And and Sao Ta 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 Sao Ta Foods are associated (or correlated) with Tng Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tng Investment And has no effect on the direction of Sao Ta i.e., Sao Ta and Tng Investment go up and down completely randomly.

Pair Corralation between Sao Ta and Tng Investment

Assuming the 90 days trading horizon Sao Ta Foods is expected to under-perform the Tng Investment. But the stock apears to be less risky and, when comparing its historical volatility, Sao Ta Foods is 2.35 times less risky than Tng Investment. The stock trades about -0.3 of its potential returns per unit of risk. The Tng Investment And is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest  2,560,000  in Tng Investment And on October 10, 2024 and sell it today you would lose (20,000) from holding Tng Investment And or give up 0.78% of portfolio value over 90 days.

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

Sao Ta Foods  vs.  Tng Investment And

Sao Ta Foods

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Sao Ta Foods has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy fundamental indicators, Sao Ta is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Tng Investment And

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Tng Investment And are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy technical and fundamental indicators, Tng Investment is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Sao Ta and Tng Investment

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

The idea behind Sao Ta Foods and Tng Investment And 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.