Correlation Between TRON and Integral Acquisition

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

By analyzing existing cross correlation between TRON and Integral Acquisition 1, you can compare the effects of market volatilities on TRON and Integral Acquisition 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 TRON with a short position of Integral Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of TRON and Integral Acquisition.

Diversification Opportunities for TRON and Integral Acquisition

-0.08

Correlation Coefficient

TRON  Integral Acquisition

Good diversification

The 3 months correlation between TRON and Integral is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding TRON and Integral Acquisition 1 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Integral Acquisition and TRON 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 TRON are associated (or correlated) with Integral Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Integral Acquisition has no effect on the direction of TRON i.e., TRON and Integral Acquisition go up and down completely randomly.

Pair Corralation between TRON and Integral Acquisition

Assuming the 90 days trading horizon TRON is expected to generate 7.86 times more return on investment than Integral Acquisition. However, TRON is 7.86 times more volatile than Integral Acquisition 1. It trades about 0.08 of its potential returns per unit of risk. Integral Acquisition 1 is currently generating about -0.06 per unit of risk. If you would invest  13.00  in TRON on October 25, 2024 and sell it today you would earn a total of  12.00  from holding TRON or generate 92.31% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	60.63%
Values	Daily Returns

TRON  vs.  Integral Acquisition 1

TRON

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in TRON are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, TRON exhibited solid returns over the last few months and may actually be approaching a breakup point.

Integral Acquisition

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Integral Acquisition 1 has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's technical and fundamental indicators remain comparatively stable which may send shares a bit higher in February 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with TRON and Integral Acquisition

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

The idea behind TRON and Integral Acquisition 1 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.