Correlation Between PureTech Health and Panther Metals
Can any of the company-specific risk be diversified away by investing in both PureTech Health and Panther Metals 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 PureTech Health and Panther Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PureTech Health plc and Panther Metals PLC, you can compare the effects of market volatilities on PureTech Health and Panther Metals 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 PureTech Health with a short position of Panther Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of PureTech Health and Panther Metals.
Diversification Opportunities for PureTech Health and Panther Metals
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between PureTech and Panther is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding PureTech Health plc and Panther Metals PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Panther Metals PLC and PureTech Health 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 PureTech Health plc are associated (or correlated) with Panther Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Panther Metals PLC has no effect on the direction of PureTech Health i.e., PureTech Health and Panther Metals go up and down completely randomly.
Pair Corralation between PureTech Health and Panther Metals
Assuming the 90 days trading horizon PureTech Health plc is expected to under-perform the Panther Metals. But the stock apears to be less risky and, when comparing its historical volatility, PureTech Health plc is 30.82 times less risky than Panther Metals. The stock trades about -0.03 of its potential returns per unit of risk. The Panther Metals PLC is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 11,875 in Panther Metals PLC on September 24, 2024 and sell it today you would lose (3,625) from holding Panther Metals PLC or give up 30.53% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.2% |
| Values | Daily Returns |
PureTech Health plc vs. Panther Metals PLC
Performance |
| Timeline |
| PureTech Health plc |
| Panther Metals PLC |
PureTech Health and Panther Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PureTech Health and Panther Metals
The main advantage of trading using opposite PureTech Health and Panther Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PureTech Health position performs unexpectedly, Panther Metals 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 Panther Metals will offset losses from the drop in Panther Metals' long position.| PureTech Health vs. Toyota Motor Corp | PureTech Health vs. SoftBank Group Corp | PureTech Health vs. OTP Bank Nyrt | PureTech Health vs. Public Service Enterprise |
| Panther Metals vs. Givaudan SA | Panther Metals vs. Antofagasta PLC | Panther Metals vs. Ferrexpo PLC | Panther Metals vs. Atalaya Mining |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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