Correlation Between Platinum Asia and Pengana Private

Can any of the company-specific risk be diversified away by investing in both Platinum Asia and Pengana Private 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 Platinum Asia and Pengana Private into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Platinum Asia Investments and Pengana Private Equity, you can compare the effects of market volatilities on Platinum Asia and Pengana Private 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 Platinum Asia with a short position of Pengana Private. Check out your portfolio center. Please also check ongoing floating volatility patterns of Platinum Asia and Pengana Private.

Diversification Opportunities for Platinum Asia and Pengana Private

0.71

Correlation Coefficient

Platinum Asia  Pengana Private

Poor diversification

The 3 months correlation between Platinum and Pengana is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Platinum Asia Investments and Pengana Private Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pengana Private Equity and Platinum Asia 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 Platinum Asia Investments are associated (or correlated) with Pengana Private. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pengana Private Equity has no effect on the direction of Platinum Asia i.e., Platinum Asia and Pengana Private go up and down completely randomly.

Pair Corralation between Platinum Asia and Pengana Private

Assuming the 90 days trading horizon Platinum Asia is expected to generate 2.2 times less return on investment than Pengana Private. But when comparing it to its historical volatility, Platinum Asia Investments is 2.95 times less risky than Pengana Private. It trades about 0.22 of its potential returns per unit of risk. Pengana Private Equity is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest  114.00  in Pengana Private Equity on September 24, 2024 and sell it today you would earn a total of  10.00  from holding Pengana Private Equity or generate 8.77% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Platinum Asia Investments  vs.  Pengana Private Equity

Platinum Asia Investments

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Platinum Asia Investments are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain forward indicators, Platinum Asia may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pengana Private Equity

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Pengana Private Equity are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Pengana Private is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Platinum Asia and Pengana Private

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

The idea behind Platinum Asia Investments and Pengana Private Equity 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.