Correlation Between Metalliance and Poxel SA

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

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

Diversification Opportunities for Metalliance and Poxel SA

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Correlation Coefficient

Metalliance  Poxel SA

Pay attention - limited upside

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

Pair Corralation between Metalliance and Poxel SA

Assuming the 90 days trading horizon Metalliance SA is expected to generate 0.57 times more return on investment than Poxel SA. However, Metalliance SA is 1.74 times less risky than Poxel SA. It trades about 0.0 of its potential returns per unit of risk. Poxel SA is currently generating about -0.04 per unit of risk. If you would invest  1,300  in Metalliance SA on October 4, 2024 and sell it today you would lose (450.00) from holding Metalliance SA or give up 34.62% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	97.22%
Values	Daily Returns

Metalliance SA  vs.  Poxel SA

Metalliance SA

Risk-Adjusted Performance

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Very Weak

Over the last 90 days Metalliance SA has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Metalliance is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Poxel SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Poxel SA has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in February 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with Metalliance and Poxel SA

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

The idea behind Metalliance SA and Poxel 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.