Correlation Between Image Protect and Protek Capital
Can any of the company-specific risk be diversified away by investing in both Image Protect and Protek Capital 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 Image Protect and Protek Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Image Protect and Protek Capital, you can compare the effects of market volatilities on Image Protect and Protek Capital 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 Image Protect with a short position of Protek Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Image Protect and Protek Capital.
Diversification Opportunities for Image Protect and Protek Capital
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Image and Protek is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Image Protect and Protek Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Protek Capital and Image Protect 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 Image Protect are associated (or correlated) with Protek Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Protek Capital has no effect on the direction of Image Protect i.e., Image Protect and Protek Capital go up and down completely randomly.
Pair Corralation between Image Protect and Protek Capital
Given the investment horizon of 90 days Image Protect is expected to generate 1.99 times less return on investment than Protek Capital. But when comparing it to its historical volatility, Image Protect is 2.09 times less risky than Protek Capital. It trades about 0.11 of its potential returns per unit of risk. Protek Capital is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 0.01 in Protek Capital on August 28, 2024 and sell it today you would earn a total of 0.00 from holding Protek Capital or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Image Protect vs. Protek Capital
Performance |
| Timeline |
| Image Protect |
| Protek Capital |
Image Protect and Protek Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Image Protect and Protek Capital
The main advantage of trading using opposite Image Protect and Protek Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Image Protect position performs unexpectedly, Protek Capital 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 Protek Capital will offset losses from the drop in Protek Capital's long position.| Image Protect vs. Salesforce | Image Protect vs. SAP SE ADR | Image Protect vs. ServiceNow | Image Protect vs. Intuit Inc |
| Protek Capital vs. Salesforce | Protek Capital vs. SAP SE ADR | Protek Capital vs. ServiceNow | Protek Capital vs. Intuit Inc |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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