Correlation Between TGCC SA and MINIERE TOUISSIT

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

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

Diversification Opportunities for TGCC SA and MINIERE TOUISSIT

0.68

Correlation Coefficient

TGCC SA  MINIERE TOUISSIT

Poor diversification

The 3 months correlation between TGCC and MINIERE is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding TGCC SA and MINIERE TOUISSIT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MINIERE TOUISSIT and TGCC SA 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 TGCC SA are associated (or correlated) with MINIERE TOUISSIT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MINIERE TOUISSIT has no effect on the direction of TGCC SA i.e., TGCC SA and MINIERE TOUISSIT go up and down completely randomly.

Pair Corralation between TGCC SA and MINIERE TOUISSIT

Assuming the 90 days trading horizon TGCC SA is expected to generate 0.82 times more return on investment than MINIERE TOUISSIT. However, TGCC SA is 1.23 times less risky than MINIERE TOUISSIT. It trades about 0.24 of its potential returns per unit of risk. MINIERE TOUISSIT is currently generating about 0.06 per unit of risk. If you would invest  23,010  in TGCC SA on December 4, 2024 and sell it today you would earn a total of  45,490  from holding TGCC SA or generate 197.7% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	99.58%
Values	Daily Returns

TGCC SA  vs.  MINIERE TOUISSIT

TGCC SA

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in TGCC SA are ranked lower than 21 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak fundamental indicators, TGCC SA exhibited solid returns over the last few months and may actually be approaching a breakup point.

MINIERE TOUISSIT

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in MINIERE TOUISSIT are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile basic indicators, MINIERE TOUISSIT may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with TGCC SA and MINIERE TOUISSIT

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

The idea behind TGCC SA and MINIERE TOUISSIT 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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.