Correlation Between Toyota and Grand Vision

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

By analyzing existing cross correlation between Toyota Motor Corp and Grand Vision Media, you can compare the effects of market volatilities on Toyota and Grand Vision 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 Toyota with a short position of Grand Vision. Check out your portfolio center. Please also check ongoing floating volatility patterns of Toyota and Grand Vision.

Diversification Opportunities for Toyota and Grand Vision

0.0

Correlation Coefficient

Toyota  Grand Vision

Pay attention - limited upside

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

Pair Corralation between Toyota and Grand Vision

Assuming the 90 days trading horizon Toyota Motor Corp is expected to generate 0.84 times more return on investment than Grand Vision. However, Toyota Motor Corp is 1.19 times less risky than Grand Vision. It trades about 0.06 of its potential returns per unit of risk. Grand Vision Media is currently generating about 0.01 per unit of risk. If you would invest  176,737  in Toyota Motor Corp on December 2, 2024 and sell it today you would earn a total of  101,663  from holding Toyota Motor Corp or generate 57.52% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	88.78%
Values	Daily Returns

Toyota Motor Corp  vs.  Grand Vision Media

Toyota Motor Corp

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Toyota Motor Corp are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady technical and fundamental indicators, Toyota may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Grand Vision Media

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Toyota and Grand Vision

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

The idea behind Toyota Motor Corp and Grand Vision Media 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.