Correlation Between Pinetree Capital and Infrax Systems
Can any of the company-specific risk be diversified away by investing in both Pinetree Capital and Infrax Systems 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 Pinetree Capital and Infrax Systems into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pinetree Capital and Infrax Systems, you can compare the effects of market volatilities on Pinetree Capital and Infrax Systems 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 Pinetree Capital with a short position of Infrax Systems. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pinetree Capital and Infrax Systems.
Diversification Opportunities for Pinetree Capital and Infrax Systems
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Pinetree and Infrax is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Pinetree Capital and Infrax Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Infrax Systems and Pinetree Capital 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 Pinetree Capital are associated (or correlated) with Infrax Systems. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Infrax Systems has no effect on the direction of Pinetree Capital i.e., Pinetree Capital and Infrax Systems go up and down completely randomly.
Pair Corralation between Pinetree Capital and Infrax Systems
Assuming the 90 days horizon Pinetree Capital is expected to generate 3.06 times less return on investment than Infrax Systems. But when comparing it to its historical volatility, Pinetree Capital is 5.08 times less risky than Infrax Systems. It trades about 0.1 of its potential returns per unit of risk. Infrax Systems is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 0.09 in Infrax Systems on September 1, 2024 and sell it today you would lose (0.05) from holding Infrax Systems or give up 55.56% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 94.51% |
| Values | Daily Returns |
Pinetree Capital vs. Infrax Systems
Performance |
| Timeline |
| Pinetree Capital |
| Infrax Systems |
Pinetree Capital and Infrax Systems Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pinetree Capital and Infrax Systems
The main advantage of trading using opposite Pinetree Capital and Infrax Systems positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pinetree Capital position performs unexpectedly, Infrax Systems 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 Infrax Systems will offset losses from the drop in Infrax Systems' long position.| Pinetree Capital vs. SPENN Technology AS | Pinetree Capital vs. OFX Group Ltd | Pinetree Capital vs. GreenBank Capital | Pinetree Capital vs. Arcane Crypto AB |
| Infrax Systems vs. SPENN Technology AS | Infrax Systems vs. OFX Group Ltd | Infrax Systems vs. Pinetree Capital | Infrax Systems vs. GreenBank Capital |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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