Correlation Between Palace SA and Uzinexport

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

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

Diversification Opportunities for Palace SA and Uzinexport

0.0

Correlation Coefficient

Palace SA  Uzinexport

Pay attention - limited upside

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

Pair Corralation between Palace SA and Uzinexport

If you would invest  50.00  in Uzinexport SA on December 23, 2024 and sell it today you would earn a total of  2.00  from holding Uzinexport SA or generate 4.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	1.79%
Values	Daily Returns

Palace SA  vs.  Uzinexport SA

Palace SA

Risk-Adjusted Performance

Very Weak

Over the last 90 days Palace SA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong fundamental indicators, Palace SA is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Uzinexport SA

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Uzinexport SA are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Uzinexport displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Palace SA and Uzinexport

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

The idea behind Palace SA and Uzinexport 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.