Correlation Between CODERE ONLINE and Polyplex (Thailand)

Can any of the company-specific risk be diversified away by investing in both CODERE ONLINE and Polyplex (Thailand) 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 CODERE ONLINE and Polyplex (Thailand) into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between CODERE ONLINE LUX and Polyplex Public, you can compare the effects of market volatilities on CODERE ONLINE and Polyplex (Thailand) 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 CODERE ONLINE with a short position of Polyplex (Thailand). Check out your portfolio center. Please also check ongoing floating volatility patterns of CODERE ONLINE and Polyplex (Thailand).

Diversification Opportunities for CODERE ONLINE and Polyplex (Thailand)

0.0

Correlation Coefficient

CODERE ONLINE  Polyplex (Thailand)

Pay attention - limited upside

The 3 months correlation between CODERE and Polyplex is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding CODERE ONLINE LUX and Polyplex Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Polyplex (Thailand) and CODERE ONLINE 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 CODERE ONLINE LUX are associated (or correlated) with Polyplex (Thailand). Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Polyplex (Thailand) has no effect on the direction of CODERE ONLINE i.e., CODERE ONLINE and Polyplex (Thailand) go up and down completely randomly.

Pair Corralation between CODERE ONLINE and Polyplex (Thailand)

Assuming the 90 days horizon CODERE ONLINE LUX is expected to under-perform the Polyplex (Thailand). In addition to that, CODERE ONLINE is 1.39 times more volatile than Polyplex Public. It trades about -0.03 of its total potential returns per unit of risk. Polyplex Public is currently generating about -0.02 per unit of volatility. If you would invest  30.00  in Polyplex Public on December 21, 2024 and sell it today you would lose (1.00) from holding Polyplex Public or give up 3.33% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

CODERE ONLINE LUX  vs.  Polyplex Public

CODERE ONLINE LUX

Risk-Adjusted Performance

Very Weak

Over the last 90 days CODERE ONLINE LUX has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, CODERE ONLINE is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Polyplex (Thailand)

Risk-Adjusted Performance

Very Weak

Over the last 90 days Polyplex Public has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Polyplex (Thailand) is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with CODERE ONLINE and Polyplex (Thailand)

The main advantage of trading using opposite CODERE ONLINE and Polyplex (Thailand) positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CODERE ONLINE position performs unexpectedly, Polyplex (Thailand) 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 Polyplex (Thailand) will offset losses from the drop in Polyplex (Thailand)'s long position.

The idea behind CODERE ONLINE LUX and Polyplex Public 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.