Correlation Between Titan Machinery and Golden Matrix

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

By analyzing existing cross correlation between Titan Machinery and Golden Matrix Group, you can compare the effects of market volatilities on Titan Machinery and Golden Matrix 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 Titan Machinery with a short position of Golden Matrix. Check out your portfolio center. Please also check ongoing floating volatility patterns of Titan Machinery and Golden Matrix.

Diversification Opportunities for Titan Machinery and Golden Matrix

-0.35

Correlation Coefficient

Titan Machinery  Golden Matrix

Very good diversification

The 3 months correlation between Titan and Golden is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Titan Machinery and Golden Matrix Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Golden Matrix Group and Titan Machinery 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 Titan Machinery are associated (or correlated) with Golden Matrix. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Golden Matrix Group has no effect on the direction of Titan Machinery i.e., Titan Machinery and Golden Matrix go up and down completely randomly.

Pair Corralation between Titan Machinery and Golden Matrix

Given the investment horizon of 90 days Titan Machinery is expected to generate 0.56 times more return on investment than Golden Matrix. However, Titan Machinery is 1.8 times less risky than Golden Matrix. It trades about 0.03 of its potential returns per unit of risk. Golden Matrix Group is currently generating about 0.01 per unit of risk. If you would invest  1,500  in Titan Machinery on December 5, 2024 and sell it today you would earn a total of  29.00  from holding Titan Machinery or generate 1.93% return on investment over 90 days.

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

Titan Machinery  vs.  Golden Matrix Group

Titan Machinery

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Titan Machinery are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, Titan Machinery is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Golden Matrix Group

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Golden Matrix Group are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong technical and fundamental indicators, Golden Matrix is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Titan Machinery and Golden Matrix

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

The idea behind Titan Machinery and Golden Matrix 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.

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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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.