Correlation Between X Financial and Turk Tuborg

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

By analyzing existing cross correlation between X Financial Class and Turk Tuborg Bira, you can compare the effects of market volatilities on X Financial and Turk Tuborg 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 X Financial with a short position of Turk Tuborg. Check out your portfolio center. Please also check ongoing floating volatility patterns of X Financial and Turk Tuborg.

Diversification Opportunities for X Financial and Turk Tuborg

0.67

Correlation Coefficient

X Financial  Turk Tuborg

Poor diversification

The 3 months correlation between XYF and Turk is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding X Financial Class and Turk Tuborg Bira in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Turk Tuborg Bira and X Financial 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 X Financial Class are associated (or correlated) with Turk Tuborg. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Turk Tuborg Bira has no effect on the direction of X Financial i.e., X Financial and Turk Tuborg go up and down completely randomly.

Pair Corralation between X Financial and Turk Tuborg

Considering the 90-day investment horizon X Financial is expected to generate 1.26 times less return on investment than Turk Tuborg. In addition to that, X Financial is 1.21 times more volatile than Turk Tuborg Bira. It trades about 0.07 of its total potential returns per unit of risk. Turk Tuborg Bira is currently generating about 0.11 per unit of volatility. If you would invest  3,430  in Turk Tuborg Bira on October 5, 2024 and sell it today you would earn a total of  10,610  from holding Turk Tuborg Bira or generate 309.33% return on investment over 90 days.

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

X Financial Class  vs.  Turk Tuborg Bira

X Financial Class

Risk-Adjusted Performance

2 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in X Financial Class are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak basic indicators, X Financial may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Turk Tuborg Bira

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Turk Tuborg Bira are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent forward indicators, Turk Tuborg may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with X Financial and Turk Tuborg

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

The idea behind X Financial Class and Turk Tuborg Bira 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 Search module to search for actively traded equities including funds and ETFs from over 30 global markets.