Correlation Between Tandy Leather and Strong Global

Can any of the company-specific risk be diversified away by investing in both Tandy Leather and Strong Global 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 Tandy Leather and Strong Global into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Tandy Leather Factory and Strong Global Entertainment,, you can compare the effects of market volatilities on Tandy Leather and Strong Global 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 Tandy Leather with a short position of Strong Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tandy Leather and Strong Global.

Diversification Opportunities for Tandy Leather and Strong Global

-0.09

Correlation Coefficient

Tandy Leather  Strong Global

Good diversification

The 3 months correlation between Tandy and Strong is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Tandy Leather Factory and Strong Global Entertainment, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Strong Global Entert and Tandy Leather 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 Tandy Leather Factory are associated (or correlated) with Strong Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Strong Global Entert has no effect on the direction of Tandy Leather i.e., Tandy Leather and Strong Global go up and down completely randomly.

Pair Corralation between Tandy Leather and Strong Global

If you would invest  155.00  in Strong Global Entertainment, on October 11, 2024 and sell it today you would earn a total of  0.00  from holding Strong Global Entertainment, or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	4.76%
Values	Daily Returns

Tandy Leather Factory  vs.  Strong Global Entertainment,

Tandy Leather Factory

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Tandy Leather Factory are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile essential indicators, Tandy Leather may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Strong Global Entert

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Strong Global Entertainment, has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound technical and fundamental indicators, Strong Global is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Tandy Leather and Strong Global

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

The idea behind Tandy Leather Factory and Strong Global Entertainment, 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.