Correlation Between Posiflex Technology and Holy Stone

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

By analyzing existing cross correlation between Posiflex Technology and Holy Stone Enterprise, you can compare the effects of market volatilities on Posiflex Technology and Holy Stone 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 Posiflex Technology with a short position of Holy Stone. Check out your portfolio center. Please also check ongoing floating volatility patterns of Posiflex Technology and Holy Stone.

Diversification Opportunities for Posiflex Technology and Holy Stone

-0.42

Correlation Coefficient

Posiflex Technology  Holy Stone

Very good diversification

The 3 months correlation between Posiflex and Holy is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Posiflex Technology and Holy Stone Enterprise in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Holy Stone Enterprise and Posiflex Technology 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 Posiflex Technology are associated (or correlated) with Holy Stone. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Holy Stone Enterprise has no effect on the direction of Posiflex Technology i.e., Posiflex Technology and Holy Stone go up and down completely randomly.

Pair Corralation between Posiflex Technology and Holy Stone

Assuming the 90 days trading horizon Posiflex Technology is expected to under-perform the Holy Stone. In addition to that, Posiflex Technology is 3.75 times more volatile than Holy Stone Enterprise. It trades about -0.06 of its total potential returns per unit of risk. Holy Stone Enterprise is currently generating about 0.15 per unit of volatility. If you would invest  8,610  in Holy Stone Enterprise on December 23, 2024 and sell it today you would earn a total of  680.00  from holding Holy Stone Enterprise or generate 7.9% return on investment over 90 days.

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

Posiflex Technology  vs.  Holy Stone Enterprise

Posiflex Technology

Risk-Adjusted Performance

Very Weak

Over the last 90 days Posiflex Technology has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in April 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Holy Stone Enterprise

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Holy Stone Enterprise are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Holy Stone may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Posiflex Technology and Holy Stone

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

The idea behind Posiflex Technology and Holy Stone Enterprise 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.