Correlation Between Graphjet Technology and 694308KB2

Can any of the company-specific risk be diversified away by investing in both Graphjet Technology and 694308KB2 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 Graphjet Technology and 694308KB2 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Graphjet Technology and PCG 42 01 MAR 29, you can compare the effects of market volatilities on Graphjet Technology and 694308KB2 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 Graphjet Technology with a short position of 694308KB2. Check out your portfolio center. Please also check ongoing floating volatility patterns of Graphjet Technology and 694308KB2.

Diversification Opportunities for Graphjet Technology and 694308KB2

0.5

Correlation Coefficient

Graphjet Technology  694308KB2

Very weak diversification

The 3 months correlation between Graphjet and 694308KB2 is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Graphjet Technology and PCG 42 01 MAR 29 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PCG 42 01 and Graphjet 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 Graphjet Technology are associated (or correlated) with 694308KB2. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PCG 42 01 has no effect on the direction of Graphjet Technology i.e., Graphjet Technology and 694308KB2 go up and down completely randomly.

Pair Corralation between Graphjet Technology and 694308KB2

Considering the 90-day investment horizon Graphjet Technology is expected to generate 19.72 times more return on investment than 694308KB2. However, Graphjet Technology is 19.72 times more volatile than PCG 42 01 MAR 29. It trades about 0.02 of its potential returns per unit of risk. PCG 42 01 MAR 29 is currently generating about 0.03 per unit of risk. If you would invest  1,057  in Graphjet Technology on October 5, 2024 and sell it today you would lose (957.00) from holding Graphjet Technology or give up 90.54% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	89.17%
Values	Daily Returns

Graphjet Technology  vs.  PCG 42 01 MAR 29

Graphjet Technology

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Graphjet Technology are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite fairly unsteady basic indicators, Graphjet Technology demonstrated solid returns over the last few months and may actually be approaching a breakup point.

PCG 42 01

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days PCG 42 01 MAR 29 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, 694308KB2 is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Graphjet Technology and 694308KB2

The main advantage of trading using opposite Graphjet Technology and 694308KB2 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Graphjet Technology position performs unexpectedly, 694308KB2 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 694308KB2 will offset losses from the drop in 694308KB2's long position.

The idea behind Graphjet Technology and PCG 42 01 MAR 29 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..