Correlation Between TOMRA SYSTEMS and EBay

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both TOMRA SYSTEMS and EBay 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 TOMRA SYSTEMS and EBay into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TOMRA SYSTEMS ASA and EBay Inc, you can compare the effects of market volatilities on TOMRA SYSTEMS and EBay 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 TOMRA SYSTEMS with a short position of EBay. Check out your portfolio center. Please also check ongoing floating volatility patterns of TOMRA SYSTEMS and EBay.

Diversification Opportunities for TOMRA SYSTEMS and EBay

0.66
  Correlation Coefficient

Poor diversification

The 3 months correlation between TOMRA and EBay is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding TOMRA SYSTEMS ASA and EBay Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EBay Inc and TOMRA SYSTEMS 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 TOMRA SYSTEMS ASA are associated (or correlated) with EBay. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EBay Inc has no effect on the direction of TOMRA SYSTEMS i.e., TOMRA SYSTEMS and EBay go up and down completely randomly.

Pair Corralation between TOMRA SYSTEMS and EBay

Assuming the 90 days horizon TOMRA SYSTEMS ASA is expected to generate 15.72 times more return on investment than EBay. However, TOMRA SYSTEMS is 15.72 times more volatile than EBay Inc. It trades about 0.14 of its potential returns per unit of risk. EBay Inc is currently generating about -0.03 per unit of risk. If you would invest  2,683  in TOMRA SYSTEMS ASA on August 30, 2022 and sell it today you would lose (837.00)  from holding TOMRA SYSTEMS ASA or give up 31.2% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

TOMRA SYSTEMS ASA  vs.  EBay Inc

 Performance (%) 
       Timeline  
TOMRA SYSTEMS ASA 
TOMRA Performance
0 of 100
Over the last 90 days TOMRA SYSTEMS ASA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of sluggish performance in the last few months, the Stock's basic indicators remain rather sound which may send shares a bit higher in December 2022. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

TOMRA Price Channel

EBay Inc 
EBay Performance
1 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in EBay Inc are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong basic indicators, EBay is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

EBay Price Channel

TOMRA SYSTEMS and EBay Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with TOMRA SYSTEMS and EBay

The main advantage of trading using opposite TOMRA SYSTEMS and EBay positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TOMRA SYSTEMS position performs unexpectedly, EBay 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 EBay will offset losses from the drop in EBay's long position.
TOMRA SYSTEMS vs. Waste Management
TOMRA SYSTEMS vs. Republic Services
TOMRA SYSTEMS vs. Waste Connections
TOMRA SYSTEMS vs. Gfl Environmental
The idea behind TOMRA SYSTEMS ASA and EBay Inc 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.
EBay vs. Groupon Cl A
EBay vs. Aarons Holdings
EBay vs. American Eagle Outfitters
EBay vs. Abercrombie Fitch
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.

Other Complementary Tools

Analyst Recommendations
Analyst recommendations and target price estimates broken down by several categories
Go
Premium Stories
Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope
Go
Headlines Timeline
Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity
Go
Content Syndication
Quickly integrate customizable finance content to your own investment portal
Go
Price Ceiling Movement
Calculate and plot Price Ceiling Movement for different equity instruments
Go
Portfolio Anywhere
Track or share privately all of your investments from the convenience of any device
Go
Portfolio Center
All portfolio management and optimization tools to improve performance of your portfolios
Go