Correlation Between Intracom Constructions and Performance Technologies
Can any of the company-specific risk be diversified away by investing in both Intracom Constructions and Performance Technologies 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 Intracom Constructions and Performance Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Intracom Constructions Societe and Performance Technologies SA, you can compare the effects of market volatilities on Intracom Constructions and Performance Technologies 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 Intracom Constructions with a short position of Performance Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intracom Constructions and Performance Technologies.
Diversification Opportunities for Intracom Constructions and Performance Technologies
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Intracom and Performance is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Intracom Constructions Societe and Performance Technologies SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Performance Technologies and Intracom Constructions 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 Intracom Constructions Societe are associated (or correlated) with Performance Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Performance Technologies has no effect on the direction of Intracom Constructions i.e., Intracom Constructions and Performance Technologies go up and down completely randomly.
Pair Corralation between Intracom Constructions and Performance Technologies
Assuming the 90 days trading horizon Intracom Constructions Societe is expected to generate 0.5 times more return on investment than Performance Technologies. However, Intracom Constructions Societe is 2.01 times less risky than Performance Technologies. It trades about -0.06 of its potential returns per unit of risk. Performance Technologies SA is currently generating about -0.05 per unit of risk. If you would invest 539.00 in Intracom Constructions Societe on September 3, 2024 and sell it today you would lose (55.00) from holding Intracom Constructions Societe or give up 10.2% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Intracom Constructions Societe vs. Performance Technologies SA
Performance |
| Timeline |
| Intracom Constructions |
| Performance Technologies |
Intracom Constructions and Performance Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Intracom Constructions and Performance Technologies
The main advantage of trading using opposite Intracom Constructions and Performance Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intracom Constructions position performs unexpectedly, Performance Technologies 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 Performance Technologies will offset losses from the drop in Performance Technologies' long position.| Intracom Constructions vs. Mytilineos SA | Intracom Constructions vs. Intracom Holdings SA | Intracom Constructions vs. Ellaktor SA | Intracom Constructions vs. GEK TERNA Holdings |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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