Correlation Between Sensient Technologies and Pingtan Marine
Can any of the company-specific risk be diversified away by investing in both Sensient Technologies and Pingtan Marine 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 Sensient Technologies and Pingtan Marine into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sensient Technologies and Pingtan Marine Enterprise, you can compare the effects of market volatilities on Sensient Technologies and Pingtan Marine 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 Sensient Technologies with a short position of Pingtan Marine. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sensient Technologies and Pingtan Marine.
Diversification Opportunities for Sensient Technologies and Pingtan Marine
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Sensient and Pingtan is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Sensient Technologies and Pingtan Marine Enterprise in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pingtan Marine Enterprise and Sensient Technologies 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 Sensient Technologies are associated (or correlated) with Pingtan Marine. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pingtan Marine Enterprise has no effect on the direction of Sensient Technologies i.e., Sensient Technologies and Pingtan Marine go up and down completely randomly.
Pair Corralation between Sensient Technologies and Pingtan Marine
If you would invest 7,523 in Sensient Technologies on September 2, 2024 and sell it today you would earn a total of 241.00 from holding Sensient Technologies or generate 3.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 4.76% |
| Values | Daily Returns |
Sensient Technologies vs. Pingtan Marine Enterprise
Performance |
| Timeline |
| Sensient Technologies |
| Pingtan Marine Enterprise |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Sensient Technologies and Pingtan Marine Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sensient Technologies and Pingtan Marine
The main advantage of trading using opposite Sensient Technologies and Pingtan Marine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sensient Technologies position performs unexpectedly, Pingtan Marine 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 Pingtan Marine will offset losses from the drop in Pingtan Marine's long position.| Sensient Technologies vs. Innospec | Sensient Technologies vs. Minerals Technologies | Sensient Technologies vs. Oil Dri | Sensient Technologies vs. H B Fuller |
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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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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