Correlation Between Promateris and IHUNT TECHNOLOGY

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

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

Diversification Opportunities for Promateris and IHUNT TECHNOLOGY

0.6

Correlation Coefficient

Promateris  IHUNT TECHNOLOGY

Poor diversification

The 3 months correlation between Promateris and IHUNT is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Promateris SA and IHUNT TECHNOLOGY IMPORT EXPORT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IHUNT TECHNOLOGY IMPORT and Promateris 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 Promateris SA are associated (or correlated) with IHUNT TECHNOLOGY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IHUNT TECHNOLOGY IMPORT has no effect on the direction of Promateris i.e., Promateris and IHUNT TECHNOLOGY go up and down completely randomly.

Pair Corralation between Promateris and IHUNT TECHNOLOGY

Assuming the 90 days trading horizon Promateris SA is expected to under-perform the IHUNT TECHNOLOGY. In addition to that, Promateris is 1.19 times more volatile than IHUNT TECHNOLOGY IMPORT EXPORT. It trades about -0.03 of its total potential returns per unit of risk. IHUNT TECHNOLOGY IMPORT EXPORT is currently generating about 0.03 per unit of volatility. If you would invest  35.00  in IHUNT TECHNOLOGY IMPORT EXPORT on December 30, 2024 and sell it today you would earn a total of  1.00  from holding IHUNT TECHNOLOGY IMPORT EXPORT or generate 2.86% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.33%
Values	Daily Returns

Promateris SA  vs.  IHUNT TECHNOLOGY IMPORT EXPORT

Promateris SA

Risk-Adjusted Performance

Very Weak

Over the last 90 days Promateris SA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unfluctuating performance, the Stock's essential indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

IHUNT TECHNOLOGY IMPORT

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in IHUNT TECHNOLOGY IMPORT EXPORT are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, IHUNT TECHNOLOGY is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Promateris and IHUNT TECHNOLOGY

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

The idea behind Promateris SA and IHUNT TECHNOLOGY IMPORT EXPORT 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.