Correlation Between Palantir Technologies and Argentum

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

By analyzing existing cross correlation between Palantir Technologies Class and Argentum 47, you can compare the effects of market volatilities on Palantir Technologies and Argentum 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 Palantir Technologies with a short position of Argentum. Check out your portfolio center. Please also check ongoing floating volatility patterns of Palantir Technologies and Argentum.

Diversification Opportunities for Palantir Technologies and Argentum

-0.76

Correlation Coefficient

Palantir Technologies  Argentum

Pay attention - limited upside

The 3 months correlation between Palantir and Argentum is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Palantir Technologies Class and Argentum 47 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Argentum 47 and Palantir Technologies 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 Palantir Technologies Class are associated (or correlated) with Argentum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Argentum 47 has no effect on the direction of Palantir Technologies i.e., Palantir Technologies and Argentum go up and down completely randomly.

Pair Corralation between Palantir Technologies and Argentum

Given the investment horizon of 90 days Palantir Technologies Class is expected to under-perform the Argentum. But the stock apears to be less risky and, when comparing its historical volatility, Palantir Technologies Class is 8.42 times less risky than Argentum. The stock trades about -0.04 of its potential returns per unit of risk. The Argentum 47 is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest  0.61  in Argentum 47 on October 26, 2024 and sell it today you would earn a total of  0.32  from holding Argentum 47 or generate 52.46% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	94.74%
Values	Daily Returns

Palantir Technologies Class  vs.  Argentum 47

Palantir Technologies

Risk-Adjusted Performance

17 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Palantir Technologies Class are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. Even with relatively abnormal basic indicators, Palantir Technologies reported solid returns over the last few months and may actually be approaching a breakup point.

Argentum 47

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Argentum 47 are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Even with relatively abnormal technical and fundamental indicators, Argentum reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Palantir Technologies and Argentum

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

The idea behind Palantir Technologies Class and Argentum 47 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 CEOs Directory module to screen CEOs from public companies around the world.