Correlation Between Corning Incorporated and TAMURA CORP

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

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

Diversification Opportunities for Corning Incorporated and TAMURA CORP

-0.65

Correlation Coefficient

Corning Incorporated  TAMURA CORP

Excellent diversification

The 3 months correlation between Corning and TAMURA is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Corning Incorporated and TAMURA P in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TAMURA CORP and Corning Incorporated 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 Corning Incorporated are associated (or correlated) with TAMURA CORP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TAMURA CORP has no effect on the direction of Corning Incorporated i.e., Corning Incorporated and TAMURA CORP go up and down completely randomly.

Pair Corralation between Corning Incorporated and TAMURA CORP

Assuming the 90 days horizon Corning Incorporated is expected to generate 0.95 times more return on investment than TAMURA CORP. However, Corning Incorporated is 1.05 times less risky than TAMURA CORP. It trades about 0.11 of its potential returns per unit of risk. TAMURA P is currently generating about -0.03 per unit of risk. If you would invest  4,330  in Corning Incorporated on October 23, 2024 and sell it today you would earn a total of  489.00  from holding Corning Incorporated or generate 11.29% return on investment over 90 days.

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

Corning Incorporated  vs.  TAMURA P

Corning Incorporated

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Corning Incorporated are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Corning Incorporated may actually be approaching a critical reversion point that can send shares even higher in February 2025.

TAMURA CORP

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Corning Incorporated and TAMURA CORP

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

The idea behind Corning Incorporated and TAMURA P 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.

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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.