Correlation Between IDEX Metals and Titanium Transportation

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

By analyzing existing cross correlation between IDEX Metals Corp and Titanium Transportation Group, you can compare the effects of market volatilities on IDEX Metals and Titanium Transportation 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 IDEX Metals with a short position of Titanium Transportation. Check out your portfolio center. Please also check ongoing floating volatility patterns of IDEX Metals and Titanium Transportation.

Diversification Opportunities for IDEX Metals and Titanium Transportation

-0.17

Correlation Coefficient

IDEX Metals  Titanium Transportation

Good diversification

The 3 months correlation between IDEX and Titanium is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding IDEX Metals Corp and Titanium Transportation Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Titanium Transportation and IDEX Metals 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 IDEX Metals Corp are associated (or correlated) with Titanium Transportation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Titanium Transportation has no effect on the direction of IDEX Metals i.e., IDEX Metals and Titanium Transportation go up and down completely randomly.

Pair Corralation between IDEX Metals and Titanium Transportation

Assuming the 90 days trading horizon IDEX Metals Corp is expected to under-perform the Titanium Transportation. In addition to that, IDEX Metals is 1.86 times more volatile than Titanium Transportation Group. It trades about -0.03 of its total potential returns per unit of risk. Titanium Transportation Group is currently generating about 0.01 per unit of volatility. If you would invest  146.00  in Titanium Transportation Group on April 16, 2025 and sell it today you would earn a total of  0.00  from holding Titanium Transportation Group or generate 0.0% return on investment over 90 days.

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

IDEX Metals Corp  vs.  Titanium Transportation Group

IDEX Metals Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days IDEX Metals Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable technical and fundamental indicators, IDEX Metals is not utilizing all of its potentials. The newest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Titanium Transportation

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Titanium Transportation Group are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of very abnormal basic indicators, Titanium Transportation displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with IDEX Metals and Titanium Transportation

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

The idea behind IDEX Metals Corp and Titanium Transportation Group 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..