Correlation Between Transimex Transportation and Tng Investment

Can any of the company-specific risk be diversified away by investing in both Transimex Transportation and Tng Investment 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 Transimex Transportation and Tng Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Transimex Transportation JSC and Tng Investment And, you can compare the effects of market volatilities on Transimex Transportation and Tng Investment 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 Transimex Transportation with a short position of Tng Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Transimex Transportation and Tng Investment.

Diversification Opportunities for Transimex Transportation and Tng Investment

0.22

Correlation Coefficient

Transimex Transportation  Tng Investment

Modest diversification

The 3 months correlation between Transimex and Tng is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Transimex Transportation JSC and Tng Investment And in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tng Investment And and Transimex Transportation 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 Transimex Transportation JSC are associated (or correlated) with Tng Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tng Investment And has no effect on the direction of Transimex Transportation i.e., Transimex Transportation and Tng Investment go up and down completely randomly.

Pair Corralation between Transimex Transportation and Tng Investment

Assuming the 90 days trading horizon Transimex Transportation JSC is expected to under-perform the Tng Investment. In addition to that, Transimex Transportation is 1.81 times more volatile than Tng Investment And. It trades about -0.03 of its total potential returns per unit of risk. Tng Investment And is currently generating about -0.01 per unit of volatility. If you would invest  2,578,902  in Tng Investment And on September 12, 2024 and sell it today you would lose (48,902) from holding Tng Investment And or give up 1.9% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	62.5%
Values	Daily Returns

Transimex Transportation JSC  vs.  Tng Investment And

Transimex Transportation

Risk-Adjusted Performance

0 of 100

Very Weak

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

Tng Investment And

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Tng Investment And has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy technical and fundamental indicators, Tng Investment is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Transimex Transportation and Tng Investment

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

The idea behind Transimex Transportation JSC and Tng Investment And 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.