Correlation Between PureCycle Technologies and Imaflex
Can any of the company-specific risk be diversified away by investing in both PureCycle Technologies and Imaflex 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 PureCycle Technologies and Imaflex into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PureCycle Technologies and Imaflex, you can compare the effects of market volatilities on PureCycle Technologies and Imaflex 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 PureCycle Technologies with a short position of Imaflex. Check out your portfolio center. Please also check ongoing floating volatility patterns of PureCycle Technologies and Imaflex.
Diversification Opportunities for PureCycle Technologies and Imaflex
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between PureCycle and Imaflex is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding PureCycle Technologies and Imaflex in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Imaflex and PureCycle Technologies 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 PureCycle Technologies are associated (or correlated) with Imaflex. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Imaflex has no effect on the direction of PureCycle Technologies i.e., PureCycle Technologies and Imaflex go up and down completely randomly.
Pair Corralation between PureCycle Technologies and Imaflex
Assuming the 90 days horizon PureCycle Technologies is expected to generate 31.29 times more return on investment than Imaflex. However, PureCycle Technologies is 31.29 times more volatile than Imaflex. It trades about 0.1 of its potential returns per unit of risk. Imaflex is currently generating about 0.16 per unit of risk. If you would invest 122.00 in PureCycle Technologies on August 28, 2024 and sell it today you would earn a total of 346.00 from holding PureCycle Technologies or generate 283.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 96.8% |
| Values | Daily Returns |
PureCycle Technologies vs. Imaflex
Performance |
| Timeline |
| PureCycle Technologies |
| Imaflex |
PureCycle Technologies and Imaflex Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PureCycle Technologies and Imaflex
The main advantage of trading using opposite PureCycle Technologies and Imaflex positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PureCycle Technologies position performs unexpectedly, Imaflex 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 Imaflex will offset losses from the drop in Imaflex's long position.| PureCycle Technologies vs. Energy Recovery | PureCycle Technologies vs. Federal Signal | PureCycle Technologies vs. Purecycle Technologies Holdings | PureCycle Technologies vs. Zurn Elkay Water |
| Imaflex vs. Ascendant Resources | Imaflex vs. Cantex Mine Development | Imaflex vs. Amarc Resources | Imaflex vs. Sterling Metals Corp |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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