Correlation Between Sporttotal and PT Global
Can any of the company-specific risk be diversified away by investing in both Sporttotal and PT Global 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 Sporttotal and PT Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sporttotal AG and PT Global Mediacom, you can compare the effects of market volatilities on Sporttotal and PT Global 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 Sporttotal with a short position of PT Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sporttotal and PT Global.
Diversification Opportunities for Sporttotal and PT Global
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Sporttotal and 06L is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Sporttotal AG and PT Global Mediacom in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Global Mediacom and Sporttotal 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 Sporttotal AG are associated (or correlated) with PT Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT Global Mediacom has no effect on the direction of Sporttotal i.e., Sporttotal and PT Global go up and down completely randomly.
Pair Corralation between Sporttotal and PT Global
Assuming the 90 days trading horizon Sporttotal AG is expected to under-perform the PT Global. In addition to that, Sporttotal is 2.22 times more volatile than PT Global Mediacom. It trades about -0.16 of its total potential returns per unit of risk. PT Global Mediacom is currently generating about -0.06 per unit of volatility. If you would invest 0.80 in PT Global Mediacom on August 28, 2024 and sell it today you would lose (0.05) from holding PT Global Mediacom or give up 6.25% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sporttotal AG vs. PT Global Mediacom
Performance |
| Timeline |
| Sporttotal AG |
| PT Global Mediacom |
Sporttotal and PT Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sporttotal and PT Global
The main advantage of trading using opposite Sporttotal and PT Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sporttotal position performs unexpectedly, PT Global 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 PT Global will offset losses from the drop in PT Global's long position.The idea behind Sporttotal AG and PT Global Mediacom pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| PT Global vs. Clearside Biomedical | PT Global vs. Compagnie Plastic Omnium | PT Global vs. SANOK RUBBER ZY | PT Global vs. Hyster Yale Materials Handling |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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