Correlation Between Polski Koncern and Komputronik

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

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

Diversification Opportunities for Polski Koncern and Komputronik

0.44

Correlation Coefficient

Polski Koncern  Komputronik

Very weak diversification

The 3 months correlation between Polski and Komputronik is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Polski Koncern Naftowy and Komputronik SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Komputronik SA and Polski Koncern 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 Polski Koncern Naftowy are associated (or correlated) with Komputronik. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Komputronik SA has no effect on the direction of Polski Koncern i.e., Polski Koncern and Komputronik go up and down completely randomly.

Pair Corralation between Polski Koncern and Komputronik

Assuming the 90 days trading horizon Polski Koncern Naftowy is expected to generate 0.64 times more return on investment than Komputronik. However, Polski Koncern Naftowy is 1.57 times less risky than Komputronik. It trades about 0.0 of its potential returns per unit of risk. Komputronik SA is currently generating about -0.02 per unit of risk. If you would invest  5,432  in Polski Koncern Naftowy on October 10, 2024 and sell it today you would lose (437.00) from holding Polski Koncern Naftowy or give up 8.04% of portfolio value over 90 days.

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

Polski Koncern Naftowy  vs.  Komputronik SA

Polski Koncern Naftowy

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Polski Koncern Naftowy has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest weak performance, the Stock's basic indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Komputronik SA

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Polski Koncern and Komputronik

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

The idea behind Polski Koncern Naftowy and Komputronik 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.