Correlation Between AD Plastik and Ingra Dd

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

By analyzing existing cross correlation between AD Plastik dd and Ingra dd, you can compare the effects of market volatilities on AD Plastik and Ingra Dd 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 AD Plastik with a short position of Ingra Dd. Check out your portfolio center. Please also check ongoing floating volatility patterns of AD Plastik and Ingra Dd.

Diversification Opportunities for AD Plastik and Ingra Dd

-0.08

Correlation Coefficient

AD Plastik  Ingra Dd

Good diversification

The 3 months correlation between ADPL and Ingra is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding AD Plastik dd and Ingra dd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ingra dd and AD Plastik 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 AD Plastik dd are associated (or correlated) with Ingra Dd. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ingra dd has no effect on the direction of AD Plastik i.e., AD Plastik and Ingra Dd go up and down completely randomly.

Pair Corralation between AD Plastik and Ingra Dd

Assuming the 90 days trading horizon AD Plastik is expected to generate 2.5 times less return on investment than Ingra Dd. But when comparing it to its historical volatility, AD Plastik dd is 1.18 times less risky than Ingra Dd. It trades about 0.06 of its potential returns per unit of risk. Ingra dd is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest  185.00  in Ingra dd on December 30, 2024 and sell it today you would earn a total of  49.00  from holding Ingra dd or generate 26.49% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	87.1%
Values	Daily Returns

AD Plastik dd  vs.  Ingra dd

AD Plastik dd

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in AD Plastik dd are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, AD Plastik unveiled solid returns over the last few months and may actually be approaching a breakup point.

Ingra dd

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Ingra dd are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Ingra Dd unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with AD Plastik and Ingra Dd

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

The idea behind AD Plastik dd and Ingra dd 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.