Correlation Between Summit Environmental and Triton International

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

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

Diversification Opportunities for Summit Environmental and Triton International

0.0

Correlation Coefficient

Summit Environmental  Triton International

Pay attention - limited upside

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

Pair Corralation between Summit Environmental and Triton International

If you would invest  1,961  in Triton International Limited on December 4, 2024 and sell it today you would earn a total of  8.00  from holding Triton International Limited or generate 0.41% return on investment over 90 days.

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

Summit Environmental  vs.  Triton International Limited

Summit Environmental

Risk-Adjusted Performance

Very Weak

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

Triton International

Risk-Adjusted Performance

Very Weak

Over the last 90 days Triton International Limited has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Preferred Stock's technical and fundamental indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Pair Trading with Summit Environmental and Triton International

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

The idea behind Summit Environmental and Triton International Limited 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.