Correlation Between PICKN PAY and FORTEC ELEKTRONIK

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

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

Diversification Opportunities for PICKN PAY and FORTEC ELEKTRONIK

0.4

Correlation Coefficient

PICKN PAY  FORTEC ELEKTRONIK

Very weak diversification

The 3 months correlation between PICKN and FORTEC is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding PICKN PAY STORES and FORTEC ELEKTRONIK in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FORTEC ELEKTRONIK and PICKN PAY 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 PICKN PAY STORES are associated (or correlated) with FORTEC ELEKTRONIK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FORTEC ELEKTRONIK has no effect on the direction of PICKN PAY i.e., PICKN PAY and FORTEC ELEKTRONIK go up and down completely randomly.

Pair Corralation between PICKN PAY and FORTEC ELEKTRONIK

Assuming the 90 days trading horizon PICKN PAY STORES is expected to under-perform the FORTEC ELEKTRONIK. In addition to that, PICKN PAY is 1.79 times more volatile than FORTEC ELEKTRONIK. It trades about -0.02 of its total potential returns per unit of risk. FORTEC ELEKTRONIK is currently generating about -0.01 per unit of volatility. If you would invest  2,388  in FORTEC ELEKTRONIK on October 26, 2024 and sell it today you would lose (448.00) from holding FORTEC ELEKTRONIK or give up 18.76% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

PICKN PAY STORES  vs.  FORTEC ELEKTRONIK

PICKN PAY STORES

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in PICKN PAY STORES are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile basic indicators, PICKN PAY unveiled solid returns over the last few months and may actually be approaching a breakup point.

FORTEC ELEKTRONIK

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in FORTEC ELEKTRONIK are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of very uncertain basic indicators, FORTEC ELEKTRONIK may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with PICKN PAY and FORTEC ELEKTRONIK

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

The idea behind PICKN PAY STORES and FORTEC ELEKTRONIK 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.