Correlation Between Polar Capital and Polar Capital
Can any of the company-specific risk be diversified away by investing in both Polar Capital and Polar Capital 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 Polar Capital and Polar Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Polar Capital Emerging and Polar Capital Emerging, you can compare the effects of market volatilities on Polar Capital and Polar Capital 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 Polar Capital with a short position of Polar Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Polar Capital and Polar Capital.
Diversification Opportunities for Polar Capital and Polar Capital
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Polar and Polar is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Polar Capital Emerging and Polar Capital Emerging in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Polar Capital Emerging and Polar 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 Polar Capital Emerging are associated (or correlated) with Polar Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Polar Capital Emerging has no effect on the direction of Polar Capital i.e., Polar Capital and Polar Capital go up and down completely randomly.
Pair Corralation between Polar Capital and Polar Capital
Assuming the 90 days horizon Polar Capital Emerging is expected to under-perform the Polar Capital. In addition to that, Polar Capital is 1.07 times more volatile than Polar Capital Emerging. It trades about -0.13 of its total potential returns per unit of risk. Polar Capital Emerging is currently generating about -0.09 per unit of volatility. If you would invest 1,188 in Polar Capital Emerging on August 30, 2024 and sell it today you would lose (40.00) from holding Polar Capital Emerging or give up 3.37% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 97.73% |
| Values | Daily Returns |
Polar Capital Emerging vs. Polar Capital Emerging
Performance |
| Timeline |
| Polar Capital Emerging |
| Polar Capital Emerging |
Polar Capital and Polar Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Polar Capital and Polar Capital
The main advantage of trading using opposite Polar Capital and Polar Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Polar Capital position performs unexpectedly, Polar Capital 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 Polar Capital will offset losses from the drop in Polar Capital's long position.| Polar Capital vs. Ms Global Fixed | Polar Capital vs. Rbc Ultra Short Fixed | Polar Capital vs. The Hartford Equity | Polar Capital vs. Ultra Short Fixed Income |
| Polar Capital vs. Small Cap Equity | Polar Capital vs. Rbc Ultra Short Fixed | Polar Capital vs. Balanced Fund Retail | Polar Capital vs. Doubleline E Fixed |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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