Correlation Between Buff Technologies and Terminal X

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

By analyzing existing cross correlation between Buff Technologies and Terminal X Online, you can compare the effects of market volatilities on Buff Technologies and Terminal X 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 Buff Technologies with a short position of Terminal X. Check out your portfolio center. Please also check ongoing floating volatility patterns of Buff Technologies and Terminal X.

Diversification Opportunities for Buff Technologies and Terminal X

0.28

Correlation Coefficient

Buff Technologies  Terminal X

Modest diversification

The 3 months correlation between Buff and Terminal is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Buff Technologies and Terminal X Online in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Terminal X Online and Buff Technologies 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 Buff Technologies are associated (or correlated) with Terminal X. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Terminal X Online has no effect on the direction of Buff Technologies i.e., Buff Technologies and Terminal X go up and down completely randomly.

Pair Corralation between Buff Technologies and Terminal X

Assuming the 90 days trading horizon Buff Technologies is expected to generate 1.46 times less return on investment than Terminal X. In addition to that, Buff Technologies is 2.03 times more volatile than Terminal X Online. It trades about 0.08 of its total potential returns per unit of risk. Terminal X Online is currently generating about 0.24 per unit of volatility. If you would invest  44,700  in Terminal X Online on May 13, 2025 and sell it today you would earn a total of  8,400  from holding Terminal X Online or generate 18.79% return on investment over 90 days.

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

Buff Technologies  vs.  Terminal X Online

Buff Technologies

Risk-Adjusted Performance

Mild

Compared to the overall equity markets, risk-adjusted returns on investments in Buff Technologies are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Buff Technologies sustained solid returns over the last few months and may actually be approaching a breakup point.

Terminal X Online

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Terminal X Online are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Terminal X sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Buff Technologies and Terminal X

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

The idea behind Buff Technologies and Terminal X Online 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..