Correlation Between Palantir Technologies and GN Store

Can any of the company-specific risk be diversified away by investing in both Palantir Technologies and GN Store 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 GN Store 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 GN Store Nord, you can compare the effects of market volatilities on Palantir Technologies and GN Store 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 GN Store. Check out your portfolio center. Please also check ongoing floating volatility patterns of Palantir Technologies and GN Store.

Diversification Opportunities for Palantir Technologies and GN Store

-0.78

Correlation Coefficient

Palantir Technologies  GN Store

Pay attention - limited upside

The 3 months correlation between Palantir and GNNDY is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding Palantir Technologies Class and GN Store Nord in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GN Store Nord 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 GN Store. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GN Store Nord has no effect on the direction of Palantir Technologies i.e., Palantir Technologies and GN Store go up and down completely randomly.

Pair Corralation between Palantir Technologies and GN Store

Given the investment horizon of 90 days Palantir Technologies Class is expected to generate 1.44 times more return on investment than GN Store. However, Palantir Technologies is 1.44 times more volatile than GN Store Nord. It trades about 0.16 of its potential returns per unit of risk. GN Store Nord is currently generating about -0.02 per unit of risk. If you would invest  1,722  in Palantir Technologies Class on September 2, 2024 and sell it today you would earn a total of  4,986  from holding Palantir Technologies Class or generate 289.55% return on investment over 90 days.

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

Palantir Technologies Class  vs.  GN Store Nord

Palantir Technologies

Risk-Adjusted Performance

24 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Palantir Technologies Class are ranked lower than 24 (%) 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.

GN Store Nord

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days GN Store Nord has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's fundamental indicators remain fairly strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Palantir Technologies and GN Store

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

The idea behind Palantir Technologies Class and GN Store Nord 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.