Correlation Between TD Holdings and Posera

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

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

Diversification Opportunities for TD Holdings and Posera

0.0

Correlation Coefficient

TD Holdings  Posera

Pay attention - limited upside

The 3 months correlation between GLG and Posera is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding TD Holdings and Posera in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Posera and TD Holdings 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 TD Holdings are associated (or correlated) with Posera. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Posera has no effect on the direction of TD Holdings i.e., TD Holdings and Posera go up and down completely randomly.

Pair Corralation between TD Holdings and Posera

If you would invest  3.25  in Posera on November 28, 2024 and sell it today you would lose (0.03) from holding Posera or give up 0.92% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

TD Holdings  vs.  Posera

TD Holdings

Risk-Adjusted Performance

Very Weak

Over the last 90 days TD Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable essential indicators, TD Holdings is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Posera

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Posera are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak basic indicators, Posera reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with TD Holdings and Posera

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

The idea behind TD Holdings and Posera 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.