Correlation Between Penta Ocean and Thermo Fisher
Can any of the company-specific risk be diversified away by investing in both Penta Ocean and Thermo Fisher 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 Penta Ocean and Thermo Fisher into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Penta Ocean Construction Co and Thermo Fisher Scientific, you can compare the effects of market volatilities on Penta Ocean and Thermo Fisher 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 Penta Ocean with a short position of Thermo Fisher. Check out your portfolio center. Please also check ongoing floating volatility patterns of Penta Ocean and Thermo Fisher.
Diversification Opportunities for Penta Ocean and Thermo Fisher
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Penta and Thermo is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Penta Ocean Construction Co and Thermo Fisher Scientific in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thermo Fisher Scientific and Penta Ocean 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 Penta Ocean Construction Co are associated (or correlated) with Thermo Fisher. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thermo Fisher Scientific has no effect on the direction of Penta Ocean i.e., Penta Ocean and Thermo Fisher go up and down completely randomly.
Pair Corralation between Penta Ocean and Thermo Fisher
Assuming the 90 days horizon Penta Ocean Construction Co is expected to generate 0.96 times more return on investment than Thermo Fisher. However, Penta Ocean Construction Co is 1.05 times less risky than Thermo Fisher. It trades about 0.17 of its potential returns per unit of risk. Thermo Fisher Scientific is currently generating about -0.05 per unit of risk. If you would invest 362.00 in Penta Ocean Construction Co on September 14, 2024 and sell it today you would earn a total of 20.00 from holding Penta Ocean Construction Co or generate 5.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Penta Ocean Construction Co vs. Thermo Fisher Scientific
Performance |
| Timeline |
| Penta Ocean Construc |
| Thermo Fisher Scientific |
Penta Ocean and Thermo Fisher Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Penta Ocean and Thermo Fisher
The main advantage of trading using opposite Penta Ocean and Thermo Fisher positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Penta Ocean position performs unexpectedly, Thermo Fisher 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 Thermo Fisher will offset losses from the drop in Thermo Fisher's long position.| Penta Ocean vs. Superior Plus Corp | Penta Ocean vs. SIVERS SEMICONDUCTORS AB | Penta Ocean vs. Norsk Hydro ASA | Penta Ocean vs. Reliance Steel Aluminum |
| Thermo Fisher vs. Penta Ocean Construction Co | Thermo Fisher vs. Coeur Mining | Thermo Fisher vs. Sterling Construction | Thermo Fisher vs. Granite Construction |
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 Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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