Correlation Between Teradyne and Pintec Technology

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

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

Diversification Opportunities for Teradyne and Pintec Technology

0.03

Correlation Coefficient

Teradyne  Pintec Technology

Significant diversification

The 3 months correlation between Teradyne and Pintec is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Teradyne and Pintec Technology Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pintec Technology and Teradyne 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 Teradyne are associated (or correlated) with Pintec Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pintec Technology has no effect on the direction of Teradyne i.e., Teradyne and Pintec Technology go up and down completely randomly.

Pair Corralation between Teradyne and Pintec Technology

Considering the 90-day investment horizon Teradyne is expected to under-perform the Pintec Technology. In addition to that, Teradyne is 1.42 times more volatile than Pintec Technology Holdings. It trades about -0.16 of its total potential returns per unit of risk. Pintec Technology Holdings is currently generating about 0.06 per unit of volatility. If you would invest  94.00  in Pintec Technology Holdings on December 20, 2024 and sell it today you would earn a total of  7.00  from holding Pintec Technology Holdings or generate 7.45% return on investment over 90 days.

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

Teradyne  vs.  Pintec Technology Holdings

Teradyne

Risk-Adjusted Performance

Very Weak

Over the last 90 days Teradyne has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's technical and fundamental indicators remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pintec Technology

Risk-Adjusted Performance

Insignificant

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

Pair Trading with Teradyne and Pintec Technology

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

The idea behind Teradyne and Pintec Technology Holdings 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..