Correlation Between World Acceptance and Touchstone Premium
Can any of the company-specific risk be diversified away by investing in both World Acceptance and Touchstone Premium 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 World Acceptance and Touchstone Premium into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between World Acceptance and Touchstone Premium Yield, you can compare the effects of market volatilities on World Acceptance and Touchstone Premium 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 World Acceptance with a short position of Touchstone Premium. Check out your portfolio center. Please also check ongoing floating volatility patterns of World Acceptance and Touchstone Premium.
Diversification Opportunities for World Acceptance and Touchstone Premium
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between World and Touchstone is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding World Acceptance and Touchstone Premium Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Touchstone Premium Yield and World Acceptance 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 World Acceptance are associated (or correlated) with Touchstone Premium. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Touchstone Premium Yield has no effect on the direction of World Acceptance i.e., World Acceptance and Touchstone Premium go up and down completely randomly.
Pair Corralation between World Acceptance and Touchstone Premium
Given the investment horizon of 90 days World Acceptance is expected to generate 2.59 times more return on investment than Touchstone Premium. However, World Acceptance is 2.59 times more volatile than Touchstone Premium Yield. It trades about 0.07 of its potential returns per unit of risk. Touchstone Premium Yield is currently generating about -0.05 per unit of risk. If you would invest 15,673 in World Acceptance on June 5, 2025 and sell it today you would earn a total of 1,319 from holding World Acceptance or generate 8.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
World Acceptance vs. Touchstone Premium Yield
Performance |
| Timeline |
| World Acceptance |
| Touchstone Premium Yield |
World Acceptance and Touchstone Premium Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with World Acceptance and Touchstone Premium
The main advantage of trading using opposite World Acceptance and Touchstone Premium positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if World Acceptance position performs unexpectedly, Touchstone Premium 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 Touchstone Premium will offset losses from the drop in Touchstone Premium's long position.| World Acceptance vs. FirstCash | World Acceptance vs. Enova International | World Acceptance vs. Green Dot | World Acceptance vs. Medallion Financial Corp |
| Touchstone Premium vs. Ep Emerging Markets | Touchstone Premium vs. Pace International Emerging | Touchstone Premium vs. Payden Emerging Markets | Touchstone Premium vs. Western Assets Emerging |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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