Correlation Between Infinity Capital and Turism Felix

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

By analyzing existing cross correlation between Infinity Capital Investments and Turism Felix B, you can compare the effects of market volatilities on Infinity Capital and Turism Felix 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 Infinity Capital with a short position of Turism Felix. Check out your portfolio center. Please also check ongoing floating volatility patterns of Infinity Capital and Turism Felix.

Diversification Opportunities for Infinity Capital and Turism Felix

-0.49

Correlation Coefficient

Infinity Capital  Turism Felix

Very good diversification

The 3 months correlation between Infinity and Turism is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Infinity Capital Investments and Turism Felix B in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Turism Felix B and Infinity Capital 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 Infinity Capital Investments are associated (or correlated) with Turism Felix. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Turism Felix B has no effect on the direction of Infinity Capital i.e., Infinity Capital and Turism Felix go up and down completely randomly.

Pair Corralation between Infinity Capital and Turism Felix

Assuming the 90 days trading horizon Infinity Capital is expected to generate 140.08 times less return on investment than Turism Felix. But when comparing it to its historical volatility, Infinity Capital Investments is 3.83 times less risky than Turism Felix. It trades about 0.0 of its potential returns per unit of risk. Turism Felix B is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest  32.00  in Turism Felix B on December 25, 2024 and sell it today you would earn a total of  10.00  from holding Turism Felix B or generate 31.25% return on investment over 90 days.

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

Infinity Capital Investments  vs.  Turism Felix B

Infinity Capital Inv

Risk-Adjusted Performance

Very Weak

Over the last 90 days Infinity Capital Investments has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Infinity Capital is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Turism Felix B

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Turism Felix B are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Turism Felix displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Infinity Capital and Turism Felix

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

The idea behind Infinity Capital Investments and Turism Felix B 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.