Correlation Between PCF Group and Genomtec
Can any of the company-specific risk be diversified away by investing in both PCF Group and Genomtec 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 PCF Group and Genomtec into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PCF Group SA and Genomtec SA, you can compare the effects of market volatilities on PCF Group and Genomtec 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 PCF Group with a short position of Genomtec. Check out your portfolio center. Please also check ongoing floating volatility patterns of PCF Group and Genomtec.
Diversification Opportunities for PCF Group and Genomtec
Modest diversification
The 3 months correlation between PCF and Genomtec is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding PCF Group SA and Genomtec SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genomtec SA and PCF Group 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 PCF Group SA are associated (or correlated) with Genomtec. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genomtec SA has no effect on the direction of PCF Group i.e., PCF Group and Genomtec go up and down completely randomly.
Pair Corralation between PCF Group and Genomtec
Assuming the 90 days trading horizon PCF Group SA is expected to under-perform the Genomtec. But the stock apears to be less risky and, when comparing its historical volatility, PCF Group SA is 1.38 times less risky than Genomtec. The stock trades about -0.1 of its potential returns per unit of risk. The Genomtec SA is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 650.00 in Genomtec SA on September 5, 2024 and sell it today you would earn a total of 44.00 from holding Genomtec SA or generate 6.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PCF Group SA vs. Genomtec SA
Performance |
| Timeline |
| PCF Group SA |
| Genomtec SA |
PCF Group and Genomtec Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PCF Group and Genomtec
The main advantage of trading using opposite PCF Group and Genomtec positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PCF Group position performs unexpectedly, Genomtec 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 Genomtec will offset losses from the drop in Genomtec's long position.| PCF Group vs. Banco Santander SA | PCF Group vs. UniCredit SpA | PCF Group vs. CEZ as | PCF Group vs. Polski Koncern Naftowy |
| Genomtec vs. Banco Santander SA | Genomtec vs. UniCredit SpA | Genomtec vs. CEZ as | Genomtec vs. Polski Koncern Naftowy |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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