Correlation Between Triple Flag and Thunderbird Entertainment

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

By analyzing existing cross correlation between Triple Flag Precious and Thunderbird Entertainment Group, you can compare the effects of market volatilities on Triple Flag and Thunderbird Entertainment 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 Triple Flag with a short position of Thunderbird Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Triple Flag and Thunderbird Entertainment.

Diversification Opportunities for Triple Flag and Thunderbird Entertainment

-0.66

Correlation Coefficient

Triple Flag  Thunderbird Entertainment

Excellent diversification

The 3 months correlation between Triple and Thunderbird is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Triple Flag Precious and Thunderbird Entertainment Grou in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thunderbird Entertainment and Triple Flag 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 Triple Flag Precious are associated (or correlated) with Thunderbird Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thunderbird Entertainment has no effect on the direction of Triple Flag i.e., Triple Flag and Thunderbird Entertainment go up and down completely randomly.

Pair Corralation between Triple Flag and Thunderbird Entertainment

Assuming the 90 days trading horizon Triple Flag Precious is expected to generate 0.59 times more return on investment than Thunderbird Entertainment. However, Triple Flag Precious is 1.68 times less risky than Thunderbird Entertainment. It trades about 0.05 of its potential returns per unit of risk. Thunderbird Entertainment Group is currently generating about -0.07 per unit of risk. If you would invest  2,308  in Triple Flag Precious on September 13, 2024 and sell it today you would earn a total of  99.00  from holding Triple Flag Precious or generate 4.29% return on investment over 90 days.

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

Triple Flag Precious  vs.  Thunderbird Entertainment Grou

Triple Flag Precious

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Triple Flag Precious are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, Triple Flag is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Thunderbird Entertainment

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Thunderbird Entertainment Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in January 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Pair Trading with Triple Flag and Thunderbird Entertainment

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

The idea behind Triple Flag Precious and Thunderbird Entertainment 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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.