Correlation Between T Mobile and Livetech

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

By analyzing existing cross correlation between T Mobile and Livetech da Bahia, you can compare the effects of market volatilities on T Mobile and Livetech 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 T Mobile with a short position of Livetech. Check out your portfolio center. Please also check ongoing floating volatility patterns of T Mobile and Livetech.

Diversification Opportunities for T Mobile and Livetech

0.09

Correlation Coefficient

T Mobile  Livetech

Significant diversification

The 3 months correlation between T1MU34 and Livetech is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding T Mobile and Livetech da Bahia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Livetech da Bahia and T Mobile 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 T Mobile are associated (or correlated) with Livetech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Livetech da Bahia has no effect on the direction of T Mobile i.e., T Mobile and Livetech go up and down completely randomly.

Pair Corralation between T Mobile and Livetech

Assuming the 90 days trading horizon T Mobile is expected to generate 0.98 times more return on investment than Livetech. However, T Mobile is 1.02 times less risky than Livetech. It trades about 0.06 of its potential returns per unit of risk. Livetech da Bahia is currently generating about -0.16 per unit of risk. If you would invest  73,800  in T Mobile on December 4, 2024 and sell it today you would earn a total of  4,691  from holding T Mobile or generate 6.36% return on investment over 90 days.

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

T Mobile  vs.  Livetech da Bahia

T Mobile

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in T Mobile are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak primary indicators, T Mobile may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Livetech da Bahia

Risk-Adjusted Performance

Very Weak

Over the last 90 days Livetech da Bahia has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with T Mobile and Livetech

The main advantage of trading using opposite T Mobile and Livetech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if T Mobile position performs unexpectedly, Livetech 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 Livetech will offset losses from the drop in Livetech's long position.

The idea behind T Mobile and Livetech da Bahia 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.