Correlation Between TOA PAINT and Jasmine Telecom

Can any of the company-specific risk be diversified away by investing in both TOA PAINT and Jasmine Telecom 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 TOA PAINT and Jasmine Telecom into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between TOA PAINT and Jasmine Telecom Systems, you can compare the effects of market volatilities on TOA PAINT and Jasmine Telecom 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 TOA PAINT with a short position of Jasmine Telecom. Check out your portfolio center. Please also check ongoing floating volatility patterns of TOA PAINT and Jasmine Telecom.

Diversification Opportunities for TOA PAINT and Jasmine Telecom

0.77

Correlation Coefficient

TOA PAINT  Jasmine Telecom

Poor diversification

The 3 months correlation between TOA and Jasmine is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding TOA PAINT and Jasmine Telecom Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jasmine Telecom Systems and TOA PAINT 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 TOA PAINT are associated (or correlated) with Jasmine Telecom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jasmine Telecom Systems has no effect on the direction of TOA PAINT i.e., TOA PAINT and Jasmine Telecom go up and down completely randomly.

Pair Corralation between TOA PAINT and Jasmine Telecom

Assuming the 90 days trading horizon TOA PAINT is expected to under-perform the Jasmine Telecom. But the stock apears to be less risky and, when comparing its historical volatility, TOA PAINT is 1.54 times less risky than Jasmine Telecom. The stock trades about -0.05 of its potential returns per unit of risk. The Jasmine Telecom Systems is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  2,750  in Jasmine Telecom Systems on October 3, 2024 and sell it today you would earn a total of  3,850  from holding Jasmine Telecom Systems or generate 140.0% return on investment over 90 days.

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

TOA PAINT  vs.  Jasmine Telecom Systems

TOA PAINT

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days TOA PAINT has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Stock's fundamental drivers remain somewhat strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Jasmine Telecom Systems

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Jasmine Telecom Systems has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent basic indicators, Jasmine Telecom is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with TOA PAINT and Jasmine Telecom

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

The idea behind TOA PAINT and Jasmine Telecom Systems 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.