Correlation Between Praram 9 and Platinum

Can any of the company-specific risk be diversified away by investing in both Praram 9 and Platinum 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 Praram 9 and Platinum into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Praram 9 Hospital and The Platinum Group, you can compare the effects of market volatilities on Praram 9 and Platinum 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 Praram 9 with a short position of Platinum. Check out your portfolio center. Please also check ongoing floating volatility patterns of Praram 9 and Platinum.

Diversification Opportunities for Praram 9 and Platinum

0.25

Correlation Coefficient

Praram 9  Platinum

Modest diversification

The 3 months correlation between Praram and Platinum is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Praram 9 Hospital and The Platinum Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Platinum Group and Praram 9 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 Praram 9 Hospital are associated (or correlated) with Platinum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Platinum Group has no effect on the direction of Praram 9 i.e., Praram 9 and Platinum go up and down completely randomly.

Pair Corralation between Praram 9 and Platinum

Assuming the 90 days trading horizon Praram 9 Hospital is expected to generate 0.89 times more return on investment than Platinum. However, Praram 9 Hospital is 1.12 times less risky than Platinum. It trades about 0.03 of its potential returns per unit of risk. The Platinum Group is currently generating about -0.11 per unit of risk. If you would invest  2,436  in Praram 9 Hospital on October 25, 2024 and sell it today you would earn a total of  54.00  from holding Praram 9 Hospital or generate 2.22% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.36%
Values	Daily Returns

Praram 9 Hospital  vs.  The Platinum Group

Praram 9 Hospital

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Praram 9 Hospital are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent basic indicators, Praram 9 is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Platinum Group

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days The Platinum Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Stock's forward-looking signals remain quite persistent which may send shares a bit higher in February 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with Praram 9 and Platinum

The main advantage of trading using opposite Praram 9 and Platinum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Praram 9 position performs unexpectedly, Platinum 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 Platinum will offset losses from the drop in Platinum's long position.

The idea behind Praram 9 Hospital and The Platinum Group 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .