Correlation Between Picomat Plastic and Military Insurance
Can any of the company-specific risk be diversified away by investing in both Picomat Plastic and Military Insurance 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 Picomat Plastic and Military Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Picomat Plastic JSC and Military Insurance Corp, you can compare the effects of market volatilities on Picomat Plastic and Military Insurance 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 Picomat Plastic with a short position of Military Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Picomat Plastic and Military Insurance.
Diversification Opportunities for Picomat Plastic and Military Insurance
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Picomat and Military is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Picomat Plastic JSC and Military Insurance Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Military Insurance Corp and Picomat Plastic 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 Picomat Plastic JSC are associated (or correlated) with Military Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Military Insurance Corp has no effect on the direction of Picomat Plastic i.e., Picomat Plastic and Military Insurance go up and down completely randomly.
Pair Corralation between Picomat Plastic and Military Insurance
Assuming the 90 days trading horizon Picomat Plastic JSC is expected to generate 2.7 times more return on investment than Military Insurance. However, Picomat Plastic is 2.7 times more volatile than Military Insurance Corp. It trades about 0.11 of its potential returns per unit of risk. Military Insurance Corp is currently generating about 0.16 per unit of risk. If you would invest 1,280,000 in Picomat Plastic JSC on November 8, 2024 and sell it today you would earn a total of 60,000 from holding Picomat Plastic JSC or generate 4.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 94.44% |
| Values | Daily Returns |
Picomat Plastic JSC vs. Military Insurance Corp
Performance |
| Timeline |
| Picomat Plastic JSC |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
OK
| Military Insurance Corp |
Picomat Plastic and Military Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Picomat Plastic and Military Insurance
The main advantage of trading using opposite Picomat Plastic and Military Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Picomat Plastic position performs unexpectedly, Military Insurance 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 Military Insurance will offset losses from the drop in Military Insurance's long position.| Picomat Plastic vs. Duong Hieu Trading | Picomat Plastic vs. Fecon Mining JSC | Picomat Plastic vs. Nam Kim Steel |
| Military Insurance vs. Ha Long Investment | Military Insurance vs. International Development Investment | Military Insurance vs. Mobile World Investment | Military Insurance vs. Transport and Industry |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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