Correlation Between Powszechny Zaklad and CD PROJEKT
Can any of the company-specific risk be diversified away by investing in both Powszechny Zaklad and CD PROJEKT 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 Powszechny Zaklad and CD PROJEKT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Powszechny Zaklad Ubezpieczen and CD PROJEKT SA, you can compare the effects of market volatilities on Powszechny Zaklad and CD PROJEKT 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 Powszechny Zaklad with a short position of CD PROJEKT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Powszechny Zaklad and CD PROJEKT.
Diversification Opportunities for Powszechny Zaklad and CD PROJEKT
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Powszechny and CDR is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Powszechny Zaklad Ubezpieczen and CD PROJEKT SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CD PROJEKT SA and Powszechny Zaklad 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 Powszechny Zaklad Ubezpieczen are associated (or correlated) with CD PROJEKT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CD PROJEKT SA has no effect on the direction of Powszechny Zaklad i.e., Powszechny Zaklad and CD PROJEKT go up and down completely randomly.
Pair Corralation between Powszechny Zaklad and CD PROJEKT
Assuming the 90 days trading horizon Powszechny Zaklad Ubezpieczen is expected to generate 0.72 times more return on investment than CD PROJEKT. However, Powszechny Zaklad Ubezpieczen is 1.39 times less risky than CD PROJEKT. It trades about 0.05 of its potential returns per unit of risk. CD PROJEKT SA is currently generating about 0.03 per unit of risk. If you would invest 3,127 in Powszechny Zaklad Ubezpieczen on August 31, 2024 and sell it today you would earn a total of 1,157 from holding Powszechny Zaklad Ubezpieczen or generate 37.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.79% |
| Values | Daily Returns |
Powszechny Zaklad Ubezpieczen vs. CD PROJEKT SA
Performance |
| Timeline |
| Powszechny Zaklad |
| CD PROJEKT SA |
Powszechny Zaklad and CD PROJEKT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Powszechny Zaklad and CD PROJEKT
The main advantage of trading using opposite Powszechny Zaklad and CD PROJEKT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Powszechny Zaklad position performs unexpectedly, CD PROJEKT 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 CD PROJEKT will offset losses from the drop in CD PROJEKT's long position.| Powszechny Zaklad vs. TEN SQUARE GAMES | Powszechny Zaklad vs. Movie Games SA | Powszechny Zaklad vs. CI Games SA | Powszechny Zaklad vs. Detalion Games SA |
| CD PROJEKT vs. MW Trade SA | CD PROJEKT vs. Skyline Investment SA | CD PROJEKT vs. New Tech Venture | CD PROJEKT vs. Investment Friends 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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