Correlation Between Textainer Group and Rev
Can any of the company-specific risk be diversified away by investing in both Textainer Group and Rev 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 Textainer Group and Rev into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Textainer Group Holdings and Rev Group, you can compare the effects of market volatilities on Textainer Group and Rev 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 Textainer Group with a short position of Rev. Check out your portfolio center. Please also check ongoing floating volatility patterns of Textainer Group and Rev.
Diversification Opportunities for Textainer Group and Rev
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Textainer and Rev is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Textainer Group Holdings and Rev Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rev Group and Textainer Group 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 Textainer Group Holdings are associated (or correlated) with Rev. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rev Group has no effect on the direction of Textainer Group i.e., Textainer Group and Rev go up and down completely randomly.
Pair Corralation between Textainer Group and Rev
Assuming the 90 days horizon Textainer Group is expected to generate 3.76 times less return on investment than Rev. In addition to that, Textainer Group is 1.53 times more volatile than Rev Group. It trades about 0.01 of its total potential returns per unit of risk. Rev Group is currently generating about 0.05 per unit of volatility. If you would invest 3,132 in Rev Group on December 28, 2024 and sell it today you would earn a total of 198.00 from holding Rev Group or generate 6.32% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 98.36% |
Values | Daily Returns |
Textainer Group Holdings vs. Rev Group
Performance |
Timeline |
Textainer Group Holdings |
Rev Group |
Textainer Group and Rev Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Textainer Group and Rev
The main advantage of trading using opposite Textainer Group and Rev positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Textainer Group position performs unexpectedly, Rev 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 Rev will offset losses from the drop in Rev's long position.Textainer Group vs. Buhler Industries | Textainer Group vs. Austin Engineering Limited | Textainer Group vs. Ag Growth International | Textainer Group vs. Grow Solutions Holdings |
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.
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