Correlation Between Palantir Technologies and Naturgy Energy
Can any of the company-specific risk be diversified away by investing in both Palantir Technologies and Naturgy Energy 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 Palantir Technologies and Naturgy Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Palantir Technologies and Naturgy Energy Group, you can compare the effects of market volatilities on Palantir Technologies and Naturgy Energy 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 Palantir Technologies with a short position of Naturgy Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Palantir Technologies and Naturgy Energy.
Diversification Opportunities for Palantir Technologies and Naturgy Energy
-0.84 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Palantir and Naturgy is -0.84. Overlapping area represents the amount of risk that can be diversified away by holding Palantir Technologies and Naturgy Energy Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Naturgy Energy Group and Palantir 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 Palantir Technologies are associated (or correlated) with Naturgy Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Naturgy Energy Group has no effect on the direction of Palantir Technologies i.e., Palantir Technologies and Naturgy Energy go up and down completely randomly.
Pair Corralation between Palantir Technologies and Naturgy Energy
Given the investment horizon of 90 days Palantir Technologies is expected to generate 4.17 times more return on investment than Naturgy Energy. However, Palantir Technologies is 4.17 times more volatile than Naturgy Energy Group. It trades about 0.29 of its potential returns per unit of risk. Naturgy Energy Group is currently generating about -0.11 per unit of risk. If you would invest 4,497 in Palantir Technologies on August 28, 2024 and sell it today you would earn a total of 1,968 from holding Palantir Technologies or generate 43.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Palantir Technologies vs. Naturgy Energy Group
Performance |
| Timeline |
| Palantir Technologies |
| Naturgy Energy Group |
Palantir Technologies and Naturgy Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Palantir Technologies and Naturgy Energy
The main advantage of trading using opposite Palantir Technologies and Naturgy Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Palantir Technologies position performs unexpectedly, Naturgy Energy 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 Naturgy Energy will offset losses from the drop in Naturgy Energy's long position.| Palantir Technologies vs. Palo Alto Networks | Palantir Technologies vs. Adobe Systems Incorporated | Palantir Technologies vs. Crowdstrike Holdings | Palantir Technologies vs. Block Inc |
| Naturgy Energy vs. Hong Kong and | Naturgy Energy vs. NewJersey Resources | Naturgy Energy vs. Atmos Energy | Naturgy Energy vs. Brookfield Infrastructure 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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