Correlation Between PMPG Polskie and Carlson Investments
Can any of the company-specific risk be diversified away by investing in both PMPG Polskie and Carlson Investments 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 PMPG Polskie and Carlson Investments into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PMPG Polskie Media and Carlson Investments SA, you can compare the effects of market volatilities on PMPG Polskie and Carlson Investments 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 PMPG Polskie with a short position of Carlson Investments. Check out your portfolio center. Please also check ongoing floating volatility patterns of PMPG Polskie and Carlson Investments.
Diversification Opportunities for PMPG Polskie and Carlson Investments
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between PMPG and Carlson is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding PMPG Polskie Media and Carlson Investments SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Carlson Investments and PMPG Polskie 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 PMPG Polskie Media are associated (or correlated) with Carlson Investments. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Carlson Investments has no effect on the direction of PMPG Polskie i.e., PMPG Polskie and Carlson Investments go up and down completely randomly.
Pair Corralation between PMPG Polskie and Carlson Investments
Assuming the 90 days trading horizon PMPG Polskie Media is expected to under-perform the Carlson Investments. But the stock apears to be less risky and, when comparing its historical volatility, PMPG Polskie Media is 1.07 times less risky than Carlson Investments. The stock trades about -0.28 of its potential returns per unit of risk. The Carlson Investments SA is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 419.00 in Carlson Investments SA on August 30, 2024 and sell it today you would earn a total of 23.00 from holding Carlson Investments SA or generate 5.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PMPG Polskie Media vs. Carlson Investments SA
Performance |
| Timeline |
| PMPG Polskie Media |
| Carlson Investments |
PMPG Polskie and Carlson Investments Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PMPG Polskie and Carlson Investments
The main advantage of trading using opposite PMPG Polskie and Carlson Investments positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PMPG Polskie position performs unexpectedly, Carlson Investments 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 Carlson Investments will offset losses from the drop in Carlson Investments' long position.| PMPG Polskie vs. Skyline Investment SA | PMPG Polskie vs. Saule Technologies SA | PMPG Polskie vs. Carlson Investments SA | PMPG Polskie vs. Inter Cars SA |
| Carlson Investments vs. Echo Investment SA | Carlson Investments vs. Quantum Software SA | Carlson Investments vs. New Tech Venture | Carlson Investments vs. Cloud Technologies SA |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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