Correlation Between Ieh Corp and TTM Technologies

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

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

Diversification Opportunities for Ieh Corp and TTM Technologies

0.08

Correlation Coefficient

Ieh Corp  TTM Technologies

Significant diversification

The 3 months correlation between Ieh and TTM is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Ieh Corp and TTM Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TTM Technologies and Ieh Corp 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 Ieh Corp are associated (or correlated) with TTM Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TTM Technologies has no effect on the direction of Ieh Corp i.e., Ieh Corp and TTM Technologies go up and down completely randomly.

Pair Corralation between Ieh Corp and TTM Technologies

Given the investment horizon of 90 days Ieh Corp is expected to generate 5.44 times less return on investment than TTM Technologies. In addition to that, Ieh Corp is 2.09 times more volatile than TTM Technologies. It trades about 0.02 of its total potential returns per unit of risk. TTM Technologies is currently generating about 0.19 per unit of volatility. If you would invest  1,785  in TTM Technologies on September 5, 2024 and sell it today you would earn a total of  664.00  from holding TTM Technologies or generate 37.2% return on investment over 90 days.

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

Ieh Corp  vs.  TTM Technologies

Ieh Corp

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Ieh Corp are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound technical indicators, Ieh Corp is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.

TTM Technologies

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in TTM Technologies are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite fairly unfluctuating primary indicators, TTM Technologies demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Ieh Corp and TTM Technologies

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

The idea behind Ieh Corp and TTM Technologies 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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.