Correlation Between Teleflex Incorporated and Old Republic

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

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

Diversification Opportunities for Teleflex Incorporated and Old Republic

-0.69

Correlation Coefficient

Teleflex Incorporated  Old Republic

Excellent diversification

The 3 months correlation between Teleflex and Old is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Teleflex Incorporated and Old Republic International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Old Republic Interna and Teleflex Incorporated 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 Teleflex Incorporated are associated (or correlated) with Old Republic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Old Republic Interna has no effect on the direction of Teleflex Incorporated i.e., Teleflex Incorporated and Old Republic go up and down completely randomly.

Pair Corralation between Teleflex Incorporated and Old Republic

Considering the 90-day investment horizon Teleflex Incorporated is expected to under-perform the Old Republic. In addition to that, Teleflex Incorporated is 2.66 times more volatile than Old Republic International. It trades about -0.11 of its total potential returns per unit of risk. Old Republic International is currently generating about 0.18 per unit of volatility. If you would invest  3,412  in Old Republic International on December 27, 2024 and sell it today you would earn a total of  453.00  from holding Old Republic International or generate 13.28% return on investment over 90 days.

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

Teleflex Incorporated  vs.  Old Republic International

Teleflex Incorporated

Risk-Adjusted Performance

Very Weak

Over the last 90 days Teleflex Incorporated has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's technical and fundamental indicators remain fairly strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Old Republic Interna

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Old Republic International are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent basic indicators, Old Republic demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Teleflex Incorporated and Old Republic

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

The idea behind Teleflex Incorporated and Old Republic International 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.