Correlation Between Pontex Polyblend and My Humble

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

By analyzing existing cross correlation between Pontex Polyblend CoLtd and My Humble House, you can compare the effects of market volatilities on Pontex Polyblend and My Humble 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 Pontex Polyblend with a short position of My Humble. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pontex Polyblend and My Humble.

Diversification Opportunities for Pontex Polyblend and My Humble

-0.71

Correlation Coefficient

Pontex Polyblend  My Humble

Pay attention - limited upside

The 3 months correlation between Pontex and 2739 is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Pontex Polyblend CoLtd and My Humble House in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on My Humble House and Pontex Polyblend 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 Pontex Polyblend CoLtd are associated (or correlated) with My Humble. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of My Humble House has no effect on the direction of Pontex Polyblend i.e., Pontex Polyblend and My Humble go up and down completely randomly.

Pair Corralation between Pontex Polyblend and My Humble

Assuming the 90 days trading horizon Pontex Polyblend CoLtd is expected to under-perform the My Humble. In addition to that, Pontex Polyblend is 1.31 times more volatile than My Humble House. It trades about -0.21 of its total potential returns per unit of risk. My Humble House is currently generating about -0.01 per unit of volatility. If you would invest  5,140  in My Humble House on September 27, 2024 and sell it today you would lose (30.00) from holding My Humble House or give up 0.58% of portfolio value over 90 days.

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

Pontex Polyblend CoLtd  vs.  My Humble House

Pontex Polyblend CoLtd

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Pontex Polyblend CoLtd are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Pontex Polyblend may actually be approaching a critical reversion point that can send shares even higher in January 2025.

My Humble House

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days My Humble House has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest abnormal performance, the Stock's basic indicators remain stable and the latest fuss on Wall Street may also be a sign of long-term gains for the venture sophisticated investors.

Pair Trading with Pontex Polyblend and My Humble

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

The idea behind Pontex Polyblend CoLtd and My Humble House 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.