Correlation Between Travel Investment and Picomat Plastic

Can any of the company-specific risk be diversified away by investing in both Travel Investment and Picomat Plastic 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 Travel Investment and Picomat Plastic into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Travel Investment and and Picomat Plastic JSC, you can compare the effects of market volatilities on Travel Investment and Picomat Plastic 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 Travel Investment with a short position of Picomat Plastic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Travel Investment and Picomat Plastic.

Diversification Opportunities for Travel Investment and Picomat Plastic

-0.46

Correlation Coefficient

Travel Investment  Picomat Plastic

Very good diversification

The 3 months correlation between Travel and Picomat is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Travel Investment and and Picomat Plastic JSC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Picomat Plastic JSC and Travel Investment 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 Travel Investment and are associated (or correlated) with Picomat Plastic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Picomat Plastic JSC has no effect on the direction of Travel Investment i.e., Travel Investment and Picomat Plastic go up and down completely randomly.

Pair Corralation between Travel Investment and Picomat Plastic

Assuming the 90 days trading horizon Travel Investment and is expected to generate 2.66 times more return on investment than Picomat Plastic. However, Travel Investment is 2.66 times more volatile than Picomat Plastic JSC. It trades about 0.12 of its potential returns per unit of risk. Picomat Plastic JSC is currently generating about -0.1 per unit of risk. If you would invest  738,000  in Travel Investment and on September 28, 2024 and sell it today you would earn a total of  39,000  from holding Travel Investment and or generate 5.28% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	86.36%
Values	Daily Returns

Travel Investment and  vs.  Picomat Plastic JSC

Travel Investment

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Travel Investment and has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Travel Investment is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Picomat Plastic JSC

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Picomat Plastic JSC are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy technical indicators, Picomat Plastic is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Travel Investment and Picomat Plastic

The main advantage of trading using opposite Travel Investment and Picomat Plastic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Travel Investment position performs unexpectedly, Picomat Plastic 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 Picomat Plastic will offset losses from the drop in Picomat Plastic's long position.

The idea behind Travel Investment and and Picomat Plastic JSC 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.

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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 Bonds Directory module to find actively traded corporate debentures issued by US companies.