Correlation Between Public Power and Intralot

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

By analyzing existing cross correlation between Public Power and Intralot SA Integrated, you can compare the effects of market volatilities on Public Power and Intralot 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 Public Power with a short position of Intralot. Check out your portfolio center. Please also check ongoing floating volatility patterns of Public Power and Intralot.

Diversification Opportunities for Public Power and Intralot

-0.13

Correlation Coefficient

Public Power  Intralot

Good diversification

The 3 months correlation between Public and Intralot is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Public Power and Intralot SA Integrated in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intralot SA Integrated and Public Power 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 Public Power are associated (or correlated) with Intralot. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intralot SA Integrated has no effect on the direction of Public Power i.e., Public Power and Intralot go up and down completely randomly.

Pair Corralation between Public Power and Intralot

Assuming the 90 days trading horizon Public Power is expected to generate 0.84 times more return on investment than Intralot. However, Public Power is 1.19 times less risky than Intralot. It trades about 0.09 of its potential returns per unit of risk. Intralot SA Integrated is currently generating about -0.11 per unit of risk. If you would invest  1,115  in Public Power on September 12, 2024 and sell it today you would earn a total of  93.00  from holding Public Power or generate 8.34% return on investment over 90 days.

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

Public Power  vs.  Intralot SA Integrated

Public Power

Risk-Adjusted Performance

6 of 100

Modest

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

Intralot SA Integrated

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Intralot SA Integrated has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Public Power and Intralot

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

The idea behind Public Power and Intralot SA Integrated 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.

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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.