Correlation Between Texas Capital and US Treasury
Can any of the company-specific risk be diversified away by investing in both Texas Capital and US Treasury 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 Texas Capital and US Treasury into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Texas Capital Funds and US Treasury 12, you can compare the effects of market volatilities on Texas Capital and US Treasury 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 Texas Capital with a short position of US Treasury. Check out your portfolio center. Please also check ongoing floating volatility patterns of Texas Capital and US Treasury.
Diversification Opportunities for Texas Capital and US Treasury
0.98 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Texas and OBIL is 0.98. Overlapping area represents the amount of risk that can be diversified away by holding Texas Capital Funds and US Treasury 12 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on US Treasury 12 and Texas Capital 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 Texas Capital Funds are associated (or correlated) with US Treasury. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of US Treasury 12 has no effect on the direction of Texas Capital i.e., Texas Capital and US Treasury go up and down completely randomly.
Pair Corralation between Texas Capital and US Treasury
Given the investment horizon of 90 days Texas Capital is expected to generate 1.04 times less return on investment than US Treasury. But when comparing it to its historical volatility, Texas Capital Funds is 2.44 times less risky than US Treasury. It trades about 1.03 of its potential returns per unit of risk. US Treasury 12 is currently generating about 0.44 of returns per unit of risk over similar time horizon. If you would invest 4,815 in US Treasury 12 on September 11, 2025 and sell it today you would earn a total of 203.00 from holding US Treasury 12 or generate 4.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 99.6% |
| Values | Daily Returns |
Texas Capital Funds vs. US Treasury 12
Performance |
| Timeline |
| Texas Capital Funds |
| US Treasury 12 |
Texas Capital and US Treasury Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Texas Capital and US Treasury
The main advantage of trading using opposite Texas Capital and US Treasury positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Texas Capital position performs unexpectedly, US Treasury 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 US Treasury will offset losses from the drop in US Treasury's long position.| Texas Capital vs. Collaborative Investment Series | Texas Capital vs. Impact Shares NAACP | Texas Capital vs. Franklin FTSE Switzerland | Texas Capital vs. GraniteShares 15x Short |
| US Treasury vs. Pacer Lunt Large | US Treasury vs. Credit Suisse X Links | US Treasury vs. AIM ETF Products | US Treasury vs. Simplify Exchange Traded |
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 the Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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