Correlation Between SupplyMe Capital and Polar Capital
Can any of the company-specific risk be diversified away by investing in both SupplyMe 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 SupplyMe 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 SupplyMe Capital PLC and Polar Capital Technology, you can compare the effects of market volatilities on SupplyMe 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 SupplyMe Capital with a short position of Polar Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of SupplyMe Capital and Polar Capital.
Diversification Opportunities for SupplyMe Capital and Polar Capital
-0.8 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between SupplyMe and Polar is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding SupplyMe Capital PLC and Polar Capital Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Polar Capital Technology and SupplyMe 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 SupplyMe Capital PLC 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 Technology has no effect on the direction of SupplyMe Capital i.e., SupplyMe Capital and Polar Capital go up and down completely randomly.
Pair Corralation between SupplyMe Capital and Polar Capital
Assuming the 90 days trading horizon SupplyMe Capital PLC is expected to generate 7.74 times more return on investment than Polar Capital. However, SupplyMe Capital is 7.74 times more volatile than Polar Capital Technology. It trades about 0.1 of its potential returns per unit of risk. Polar Capital Technology is currently generating about 0.26 per unit of risk. If you would invest 0.30 in SupplyMe Capital PLC on September 4, 2024 and sell it today you would earn a total of 0.04 from holding SupplyMe Capital PLC or generate 13.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SupplyMe Capital PLC vs. Polar Capital Technology
Performance |
| Timeline |
| SupplyMe Capital PLC |
| Polar Capital Technology |
SupplyMe Capital and Polar Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SupplyMe Capital and Polar Capital
The main advantage of trading using opposite SupplyMe Capital and Polar Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SupplyMe 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.| SupplyMe Capital vs. Alior Bank SA | SupplyMe Capital vs. Sparebank 1 SR | SupplyMe Capital vs. Veolia Environnement VE | SupplyMe Capital vs. CAP LEASE AVIATION |
| Polar Capital vs. SupplyMe Capital PLC | Polar Capital vs. Lloyds Banking Group | Polar Capital vs. Premier African Minerals | Polar Capital vs. SANTANDER UK 8 |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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