Correlation Between Toppan Printing and All American

Can any of the company-specific risk be diversified away by investing in both Toppan Printing and All American 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 Toppan Printing and All American into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Toppan Printing and All American Pet, you can compare the effects of market volatilities on Toppan Printing and All American 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 Toppan Printing with a short position of All American. Check out your portfolio center. Please also check ongoing floating volatility patterns of Toppan Printing and All American.

Diversification Opportunities for Toppan Printing and All American

-0.51

Correlation Coefficient

Toppan Printing  All American

Excellent diversification

The 3 months correlation between Toppan and All is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Toppan Printing and All American Pet in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on All American Pet and Toppan Printing 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 Toppan Printing are associated (or correlated) with All American. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of All American Pet has no effect on the direction of Toppan Printing i.e., Toppan Printing and All American go up and down completely randomly.

Pair Corralation between Toppan Printing and All American

Assuming the 90 days horizon Toppan Printing is expected to generate 0.29 times more return on investment than All American. However, Toppan Printing is 3.4 times less risky than All American. It trades about 0.04 of its potential returns per unit of risk. All American Pet is currently generating about -0.13 per unit of risk. If you would invest  1,332  in Toppan Printing on December 19, 2024 and sell it today you would earn a total of  59.00  from holding Toppan Printing or generate 4.43% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	98.31%
Values	Daily Returns

Toppan Printing  vs.  All American Pet

Toppan Printing

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Toppan Printing are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of fairly uncertain basic indicators, Toppan Printing may actually be approaching a critical reversion point that can send shares even higher in April 2025.

All American Pet

Risk-Adjusted Performance

Very Weak

Over the last 90 days All American Pet has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Toppan Printing and All American

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

The idea behind Toppan Printing and All American Pet 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.