Correlation Between Asseco Business and PCC Rokita

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

By analyzing existing cross correlation between Asseco Business Solutions and PCC Rokita SA, you can compare the effects of market volatilities on Asseco Business and PCC Rokita 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 Asseco Business with a short position of PCC Rokita. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asseco Business and PCC Rokita.

Diversification Opportunities for Asseco Business and PCC Rokita

-0.11

Correlation Coefficient

Asseco Business  PCC Rokita

Good diversification

The 3 months correlation between Asseco and PCC is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Asseco Business Solutions and PCC Rokita SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PCC Rokita SA and Asseco Business 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 Asseco Business Solutions are associated (or correlated) with PCC Rokita. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PCC Rokita SA has no effect on the direction of Asseco Business i.e., Asseco Business and PCC Rokita go up and down completely randomly.

Pair Corralation between Asseco Business and PCC Rokita

Assuming the 90 days trading horizon Asseco Business Solutions is expected to generate 1.35 times more return on investment than PCC Rokita. However, Asseco Business is 1.35 times more volatile than PCC Rokita SA. It trades about 0.08 of its potential returns per unit of risk. PCC Rokita SA is currently generating about -0.12 per unit of risk. If you would invest  5,480  in Asseco Business Solutions on October 24, 2024 and sell it today you would earn a total of  440.00  from holding Asseco Business Solutions or generate 8.03% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.25%
Values	Daily Returns

Asseco Business Solutions  vs.  PCC Rokita SA

Asseco Business Solutions

Risk-Adjusted Performance

5 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Asseco Business Solutions are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Asseco Business may actually be approaching a critical reversion point that can send shares even higher in February 2025.

PCC Rokita SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days PCC Rokita SA has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest weak performance, the Stock's basic indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Pair Trading with Asseco Business and PCC Rokita

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

The idea behind Asseco Business Solutions and PCC Rokita SA 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.