Correlation Between Pintec Technology and Investcorp India

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

By analyzing existing cross correlation between Pintec Technology Holdings and Investcorp India Acquisition, you can compare the effects of market volatilities on Pintec Technology and Investcorp India 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 Pintec Technology with a short position of Investcorp India. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pintec Technology and Investcorp India.

Diversification Opportunities for Pintec Technology and Investcorp India

0.47

Correlation Coefficient

Pintec Technology  Investcorp India

Very weak diversification

The 3 months correlation between Pintec and Investcorp is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Pintec Technology Holdings and Investcorp India Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Investcorp India Acq and Pintec Technology 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 Pintec Technology Holdings are associated (or correlated) with Investcorp India. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Investcorp India Acq has no effect on the direction of Pintec Technology i.e., Pintec Technology and Investcorp India go up and down completely randomly.

Pair Corralation between Pintec Technology and Investcorp India

Allowing for the 90-day total investment horizon Pintec Technology Holdings is expected to generate 4.48 times more return on investment than Investcorp India. However, Pintec Technology is 4.48 times more volatile than Investcorp India Acquisition. It trades about 0.12 of its potential returns per unit of risk. Investcorp India Acquisition is currently generating about 0.05 per unit of risk. If you would invest  90.00  in Pintec Technology Holdings on December 29, 2024 and sell it today you would earn a total of  15.00  from holding Pintec Technology Holdings or generate 16.67% return on investment over 90 days.

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

Pintec Technology Holdings  vs.  Investcorp India Acquisition

Pintec Technology

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Pintec Technology Holdings are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Pintec Technology unveiled solid returns over the last few months and may actually be approaching a breakup point.

Investcorp India Acq

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Investcorp India Acquisition are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Investcorp India is not utilizing all of its potentials. The recent stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Pintec Technology and Investcorp India

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

The idea behind Pintec Technology Holdings and Investcorp India Acquisition 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.