Correlation Between Fondul Deschis and TRANSILVANIA LEASING

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

By analyzing existing cross correlation between Fondul Deschis De and TRANSILVANIA LEASING SI, you can compare the effects of market volatilities on Fondul Deschis and TRANSILVANIA LEASING 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 Fondul Deschis with a short position of TRANSILVANIA LEASING. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fondul Deschis and TRANSILVANIA LEASING.

Diversification Opportunities for Fondul Deschis and TRANSILVANIA LEASING

0.6

Correlation Coefficient

Fondul Deschis  TRANSILVANIA LEASING

Poor diversification

The 3 months correlation between Fondul and TRANSILVANIA is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Fondul Deschis De and TRANSILVANIA LEASING SI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TRANSILVANIA LEASING and Fondul Deschis 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 Fondul Deschis De are associated (or correlated) with TRANSILVANIA LEASING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TRANSILVANIA LEASING has no effect on the direction of Fondul Deschis i.e., Fondul Deschis and TRANSILVANIA LEASING go up and down completely randomly.

Pair Corralation between Fondul Deschis and TRANSILVANIA LEASING

Assuming the 90 days trading horizon Fondul Deschis De is expected to under-perform the TRANSILVANIA LEASING. But the etf apears to be less risky and, when comparing its historical volatility, Fondul Deschis De is 2.12 times less risky than TRANSILVANIA LEASING. The etf trades about -0.01 of its potential returns per unit of risk. The TRANSILVANIA LEASING SI is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  8.30  in TRANSILVANIA LEASING SI on September 26, 2024 and sell it today you would earn a total of  0.25  from holding TRANSILVANIA LEASING SI or generate 3.01% return on investment over 90 days.

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

Fondul Deschis De  vs.  TRANSILVANIA LEASING SI

Fondul Deschis De

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Fondul Deschis De has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Fondul Deschis is not utilizing all of its potentials. The recent stock price uproar, may contribute to short-horizon losses for the private investors.

TRANSILVANIA LEASING

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days TRANSILVANIA LEASING SI has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unfluctuating 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 Fondul Deschis and TRANSILVANIA LEASING

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

The idea behind Fondul Deschis De and TRANSILVANIA LEASING SI 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.

Check out your portfolio center.

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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.