Correlation Between Tritent International and Estee Lauder

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

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

Diversification Opportunities for Tritent International and Estee Lauder

0.0

Correlation Coefficient

Tritent International  Estee Lauder

Pay attention - limited upside

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

Pair Corralation between Tritent International and Estee Lauder

If you would invest  6,256  in Estee Lauder Companies on September 14, 2024 and sell it today you would earn a total of  1,866  from holding Estee Lauder Companies or generate 29.83% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Tritent International Agricult  vs.  Estee Lauder Companies

Tritent International

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Tritent International Agriculture has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent primary indicators, Tritent International is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Estee Lauder Companies

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Estee Lauder Companies has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent essential indicators, Estee Lauder is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with Tritent International and Estee Lauder

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

The idea behind Tritent International Agriculture and Estee Lauder Companies 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.