Correlation Between Pontex Polyblend and Energenesis Biomedical

Can any of the company-specific risk be diversified away by investing in both Pontex Polyblend and Energenesis Biomedical 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 Energenesis Biomedical 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 Energenesis Biomedical Co, you can compare the effects of market volatilities on Pontex Polyblend and Energenesis Biomedical 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 Energenesis Biomedical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pontex Polyblend and Energenesis Biomedical.

Diversification Opportunities for Pontex Polyblend and Energenesis Biomedical

0.24

Correlation Coefficient

Pontex Polyblend  Energenesis Biomedical

Modest diversification

The 3 months correlation between Pontex and Energenesis is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Pontex Polyblend CoLtd and Energenesis Biomedical Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Energenesis Biomedical 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 Energenesis Biomedical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Energenesis Biomedical has no effect on the direction of Pontex Polyblend i.e., Pontex Polyblend and Energenesis Biomedical go up and down completely randomly.

Pair Corralation between Pontex Polyblend and Energenesis Biomedical

Assuming the 90 days trading horizon Pontex Polyblend CoLtd is expected to generate 1.65 times more return on investment than Energenesis Biomedical. However, Pontex Polyblend is 1.65 times more volatile than Energenesis Biomedical Co. It trades about 0.15 of its potential returns per unit of risk. Energenesis Biomedical Co is currently generating about 0.04 per unit of risk. If you would invest  1,720  in Pontex Polyblend CoLtd on September 12, 2024 and sell it today you would earn a total of  460.00  from holding Pontex Polyblend CoLtd or generate 26.74% return on investment over 90 days.

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

Pontex Polyblend CoLtd  vs.  Energenesis Biomedical Co

Pontex Polyblend CoLtd

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Pontex Polyblend CoLtd are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Pontex Polyblend showed solid returns over the last few months and may actually be approaching a breakup point.

Energenesis Biomedical

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Energenesis Biomedical Co are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of fairly stable basic indicators, Energenesis Biomedical is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with Pontex Polyblend and Energenesis Biomedical

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

The idea behind Pontex Polyblend CoLtd and Energenesis Biomedical Co 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.