Correlation Between Materialise and PKSHA TECHNOLOGY
Can any of the company-specific risk be diversified away by investing in both Materialise and PKSHA 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 Materialise and PKSHA TECHNOLOGY into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Materialise NV and PKSHA TECHNOLOGY INC, you can compare the effects of market volatilities on Materialise and PKSHA 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 Materialise with a short position of PKSHA TECHNOLOGY. Check out your portfolio center. Please also check ongoing floating volatility patterns of Materialise and PKSHA TECHNOLOGY.
Diversification Opportunities for Materialise and PKSHA TECHNOLOGY
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Materialise and PKSHA is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Materialise NV and PKSHA TECHNOLOGY INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PKSHA TECHNOLOGY INC and Materialise 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 Materialise NV are associated (or correlated) with PKSHA TECHNOLOGY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PKSHA TECHNOLOGY INC has no effect on the direction of Materialise i.e., Materialise and PKSHA TECHNOLOGY go up and down completely randomly.
Pair Corralation between Materialise and PKSHA TECHNOLOGY
Assuming the 90 days trading horizon Materialise NV is expected to generate 1.93 times more return on investment than PKSHA TECHNOLOGY. However, Materialise is 1.93 times more volatile than PKSHA TECHNOLOGY INC. It trades about -0.04 of its potential returns per unit of risk. PKSHA TECHNOLOGY INC is currently generating about -0.32 per unit of risk. If you would invest 750.00 in Materialise NV on October 17, 2024 and sell it today you would lose (25.00) from holding Materialise NV or give up 3.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Materialise NV vs. PKSHA TECHNOLOGY INC
Performance |
| Timeline |
| Materialise NV |
| PKSHA TECHNOLOGY INC |
Materialise and PKSHA TECHNOLOGY Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Materialise and PKSHA TECHNOLOGY
The main advantage of trading using opposite Materialise and PKSHA TECHNOLOGY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Materialise position performs unexpectedly, PKSHA 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 PKSHA TECHNOLOGY will offset losses from the drop in PKSHA TECHNOLOGY's long position.| Materialise vs. MICRONIC MYDATA | Materialise vs. DATAGROUP SE | Materialise vs. INFORMATION SVC GRP | Materialise vs. China Datang |
| PKSHA TECHNOLOGY vs. Materialise NV | PKSHA TECHNOLOGY vs. GOLD ROAD RES | PKSHA TECHNOLOGY vs. Martin Marietta Materials | PKSHA TECHNOLOGY vs. Summit Materials |
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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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