Correlation Between Polaris Office and NewFlex Technology
Can any of the company-specific risk be diversified away by investing in both Polaris Office and NewFlex Technology 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 Polaris Office and NewFlex Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Polaris Office Corp and NewFlex Technology Co, you can compare the effects of market volatilities on Polaris Office and NewFlex Technology 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 Polaris Office with a short position of NewFlex Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Polaris Office and NewFlex Technology.
Diversification Opportunities for Polaris Office and NewFlex Technology
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Polaris and NewFlex is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Polaris Office Corp and NewFlex Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NewFlex Technology and Polaris Office 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 Polaris Office Corp are associated (or correlated) with NewFlex Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NewFlex Technology has no effect on the direction of Polaris Office i.e., Polaris Office and NewFlex Technology go up and down completely randomly.
Pair Corralation between Polaris Office and NewFlex Technology
Assuming the 90 days trading horizon Polaris Office is expected to generate 3.38 times less return on investment than NewFlex Technology. In addition to that, Polaris Office is 1.23 times more volatile than NewFlex Technology Co. It trades about 0.01 of its total potential returns per unit of risk. NewFlex Technology Co is currently generating about 0.06 per unit of volatility. If you would invest 479,000 in NewFlex Technology Co on September 24, 2024 and sell it today you would earn a total of 17,000 from holding NewFlex Technology Co or generate 3.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Polaris Office Corp vs. NewFlex Technology Co
Performance |
| Timeline |
| Polaris Office Corp |
| NewFlex Technology |
Polaris Office and NewFlex Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Polaris Office and NewFlex Technology
The main advantage of trading using opposite Polaris Office and NewFlex Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Polaris Office position performs unexpectedly, NewFlex Technology 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 NewFlex Technology will offset losses from the drop in NewFlex Technology's long position.| Polaris Office vs. Dongsin Engineering Construction | Polaris Office vs. Doosan Fuel Cell | Polaris Office vs. Daishin Balance 1 | Polaris Office vs. Total Soft Bank |
| NewFlex Technology vs. Seoyon Topmetal Co | NewFlex Technology vs. Duksan Hi Metal | NewFlex Technology vs. PJ Metal Co | NewFlex Technology vs. Youngsin Metal Industrial |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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