Correlation Between TOR Minerals and RPM International

Can any of the company-specific risk be diversified away by investing in both TOR Minerals and RPM International 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 TOR Minerals and RPM International into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between TOR Minerals International and RPM International, you can compare the effects of market volatilities on TOR Minerals and RPM International 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 TOR Minerals with a short position of RPM International. Check out your portfolio center. Please also check ongoing floating volatility patterns of TOR Minerals and RPM International.

Diversification Opportunities for TOR Minerals and RPM International

0.0

Correlation Coefficient

TOR Minerals  RPM International

Pay attention - limited upside

The 3 months correlation between TOR and RPM is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding TOR Minerals International and RPM International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RPM International and TOR Minerals 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 TOR Minerals International are associated (or correlated) with RPM International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RPM International has no effect on the direction of TOR Minerals i.e., TOR Minerals and RPM International go up and down completely randomly.

Pair Corralation between TOR Minerals and RPM International

If you would invest (100.00) in TOR Minerals International on December 25, 2024 and sell it today you would earn a total of  100.00  from holding TOR Minerals International or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

TOR Minerals International  vs.  RPM International

TOR Minerals Interna

Risk-Adjusted Performance

Very Weak

Over the last 90 days TOR Minerals International has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, TOR Minerals is not utilizing all of its potentials. The newest stock price disarray, may contribute to short-term losses for the investors.

RPM International

Risk-Adjusted Performance

Very Weak

Over the last 90 days RPM International has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's basic indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

Pair Trading with TOR Minerals and RPM International

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

The idea behind TOR Minerals International and RPM International 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.