Correlation Between PKP Cargo and Gamedust
Can any of the company-specific risk be diversified away by investing in both PKP Cargo and Gamedust 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 PKP Cargo and Gamedust into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PKP Cargo SA and Gamedust SA, you can compare the effects of market volatilities on PKP Cargo and Gamedust 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 PKP Cargo with a short position of Gamedust. Check out your portfolio center. Please also check ongoing floating volatility patterns of PKP Cargo and Gamedust.
Diversification Opportunities for PKP Cargo and Gamedust
Very weak diversification
The 3 months correlation between PKP and Gamedust is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding PKP Cargo SA and Gamedust SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gamedust SA and PKP Cargo 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 PKP Cargo SA are associated (or correlated) with Gamedust. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gamedust SA has no effect on the direction of PKP Cargo i.e., PKP Cargo and Gamedust go up and down completely randomly.
Pair Corralation between PKP Cargo and Gamedust
Assuming the 90 days trading horizon PKP Cargo SA is expected to under-perform the Gamedust. But the stock apears to be less risky and, when comparing its historical volatility, PKP Cargo SA is 2.33 times less risky than Gamedust. The stock trades about -0.01 of its potential returns per unit of risk. The Gamedust SA is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 19.00 in Gamedust SA on September 2, 2024 and sell it today you would lose (9.26) from holding Gamedust SA or give up 48.74% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 84.72% |
| Values | Daily Returns |
PKP Cargo SA vs. Gamedust SA
Performance |
| Timeline |
| PKP Cargo SA |
| Gamedust SA |
PKP Cargo and Gamedust Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PKP Cargo and Gamedust
The main advantage of trading using opposite PKP Cargo and Gamedust positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PKP Cargo position performs unexpectedly, Gamedust 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 Gamedust will offset losses from the drop in Gamedust's long position.| PKP Cargo vs. Banco Santander SA | PKP Cargo vs. UniCredit SpA | PKP Cargo vs. CEZ as | PKP Cargo vs. Polski Koncern Naftowy |
| Gamedust vs. Asseco Business Solutions | Gamedust vs. Detalion Games SA | Gamedust vs. Asseco South Eastern | Gamedust vs. CFI Holding 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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