Correlation Between Tauron Polska and Stalprodukt
Can any of the company-specific risk be diversified away by investing in both Tauron Polska and Stalprodukt 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 Tauron Polska and Stalprodukt into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tauron Polska Energia and Stalprodukt SA, you can compare the effects of market volatilities on Tauron Polska and Stalprodukt 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 Tauron Polska with a short position of Stalprodukt. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tauron Polska and Stalprodukt.
Diversification Opportunities for Tauron Polska and Stalprodukt
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Tauron and Stalprodukt is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Tauron Polska Energia and Stalprodukt SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stalprodukt SA and Tauron Polska 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 Tauron Polska Energia are associated (or correlated) with Stalprodukt. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stalprodukt SA has no effect on the direction of Tauron Polska i.e., Tauron Polska and Stalprodukt go up and down completely randomly.
Pair Corralation between Tauron Polska and Stalprodukt
Assuming the 90 days trading horizon Tauron Polska Energia is expected to generate 1.61 times more return on investment than Stalprodukt. However, Tauron Polska is 1.61 times more volatile than Stalprodukt SA. It trades about 0.07 of its potential returns per unit of risk. Stalprodukt SA is currently generating about -0.02 per unit of risk. If you would invest 213.00 in Tauron Polska Energia on November 2, 2024 and sell it today you would earn a total of 210.00 from holding Tauron Polska Energia or generate 98.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tauron Polska Energia vs. Stalprodukt SA
Performance |
| Timeline |
| Tauron Polska Energia |
| Stalprodukt SA |
Tauron Polska and Stalprodukt Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tauron Polska and Stalprodukt
The main advantage of trading using opposite Tauron Polska and Stalprodukt positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tauron Polska position performs unexpectedly, Stalprodukt 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 Stalprodukt will offset losses from the drop in Stalprodukt's long position.| Tauron Polska vs. New Tech Venture | Tauron Polska vs. Marie Brizard Wine | Tauron Polska vs. X Trade Brokers | Tauron Polska vs. MW Trade SA |
| Stalprodukt vs. Immobile | Stalprodukt vs. Santander Bank Polska | Stalprodukt vs. LSI Software SA | Stalprodukt vs. New Tech Venture |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
Other Complementary Tools
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences |