Correlation Between Polski Koncern and Enter Air
Can any of the company-specific risk be diversified away by investing in both Polski Koncern and Enter Air 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 Polski Koncern and Enter Air into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Polski Koncern Naftowy and Enter Air SA, you can compare the effects of market volatilities on Polski Koncern and Enter Air 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 Polski Koncern with a short position of Enter Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of Polski Koncern and Enter Air.
Diversification Opportunities for Polski Koncern and Enter Air
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Polski and Enter is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Polski Koncern Naftowy and Enter Air SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Enter Air SA and Polski Koncern 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 Polski Koncern Naftowy are associated (or correlated) with Enter Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Enter Air SA has no effect on the direction of Polski Koncern i.e., Polski Koncern and Enter Air go up and down completely randomly.
Pair Corralation between Polski Koncern and Enter Air
Assuming the 90 days trading horizon Polski Koncern Naftowy is expected to generate 0.91 times more return on investment than Enter Air. However, Polski Koncern Naftowy is 1.1 times less risky than Enter Air. It trades about 0.57 of its potential returns per unit of risk. Enter Air SA is currently generating about -0.05 per unit of risk. If you would invest 4,690 in Polski Koncern Naftowy on October 25, 2024 and sell it today you would earn a total of 590.00 from holding Polski Koncern Naftowy or generate 12.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Polski Koncern Naftowy vs. Enter Air SA
Performance |
| Timeline |
| Polski Koncern Naftowy |
| Enter Air SA |
Polski Koncern and Enter Air Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Polski Koncern and Enter Air
The main advantage of trading using opposite Polski Koncern and Enter Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Polski Koncern position performs unexpectedly, Enter Air 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 Enter Air will offset losses from the drop in Enter Air's long position.| Polski Koncern vs. Globe Trade Centre | Polski Koncern vs. Gaming Factory SA | Polski Koncern vs. Mlk Foods Public | Polski Koncern vs. Gamedust SA |
| Enter Air vs. True Games Syndicate | Enter Air vs. CI Games SA | Enter Air vs. Cloud Technologies SA | Enter Air vs. Immobile |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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