Correlation Between Marwyn Value and Tetragon Financial

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

By analyzing existing cross correlation between Marwyn Value Investors and Tetragon Financial Group, you can compare the effects of market volatilities on Marwyn Value and Tetragon Financial 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 Marwyn Value with a short position of Tetragon Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Marwyn Value and Tetragon Financial.

Diversification Opportunities for Marwyn Value and Tetragon Financial

-0.04

Correlation Coefficient

Marwyn Value  Tetragon Financial

Good diversification

The 3 months correlation between Marwyn and Tetragon is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Marwyn Value Investors and Tetragon Financial Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tetragon Financial and Marwyn Value 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 Marwyn Value Investors are associated (or correlated) with Tetragon Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tetragon Financial has no effect on the direction of Marwyn Value i.e., Marwyn Value and Tetragon Financial go up and down completely randomly.

Pair Corralation between Marwyn Value and Tetragon Financial

Assuming the 90 days trading horizon Marwyn Value is expected to generate 1.54 times less return on investment than Tetragon Financial. In addition to that, Marwyn Value is 1.04 times more volatile than Tetragon Financial Group. It trades about 0.07 of its total potential returns per unit of risk. Tetragon Financial Group is currently generating about 0.11 per unit of volatility. If you would invest  895.00  in Tetragon Financial Group on October 10, 2024 and sell it today you would earn a total of  510.00  from holding Tetragon Financial Group or generate 56.98% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	99.8%
Values	Daily Returns

Marwyn Value Investors  vs.  Tetragon Financial Group

Marwyn Value Investors

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Marwyn Value Investors are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain technical and fundamental indicators, Marwyn Value exhibited solid returns over the last few months and may actually be approaching a breakup point.

Tetragon Financial

Risk-Adjusted Performance

21 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Tetragon Financial Group are ranked lower than 21 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain technical and fundamental indicators, Tetragon Financial exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Marwyn Value and Tetragon Financial

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

The idea behind Marwyn Value Investors and Tetragon Financial Group 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.