Correlation Between TENK Old and Glori Energy

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

By analyzing existing cross correlation between TENK Old and Glori Energy Technology, you can compare the effects of market volatilities on TENK Old and Glori Energy 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 TENK Old with a short position of Glori Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of TENK Old and Glori Energy.

Diversification Opportunities for TENK Old and Glori Energy

0.0

Correlation Coefficient

TENK Old  Glori Energy

Pay attention - limited upside

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

Pair Corralation between TENK Old and Glori Energy

If you would invest (100.00) in Glori Energy Technology on December 1, 2024 and sell it today you would earn a total of  100.00  from holding Glori Energy Technology or generate -100.0% return on investment over 90 days.

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

TENK Old  vs.  Glori Energy Technology

TENK Old

Risk-Adjusted Performance

Very Weak

Over the last 90 days TENK Old has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent basic indicators, TENK Old is not utilizing all of its potentials. The current stock price mess, may contribute to short-term losses for the institutional investors.

Glori Energy Technology

Risk-Adjusted Performance

Very Weak

Over the last 90 days Glori Energy Technology has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, Glori Energy is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with TENK Old and Glori Energy

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

The idea behind TENK Old and Glori Energy Technology 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.