Correlation Between PTC INDUSTRIES and Sasken Technologies

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

By analyzing existing cross correlation between PTC INDUSTRIES LTD and Sasken Technologies Limited, you can compare the effects of market volatilities on PTC INDUSTRIES and Sasken Technologies 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 PTC INDUSTRIES with a short position of Sasken Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of PTC INDUSTRIES and Sasken Technologies.

Diversification Opportunities for PTC INDUSTRIES and Sasken Technologies

-0.78

Correlation Coefficient

PTC INDUSTRIES  Sasken Technologies

Pay attention - limited upside

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

Pair Corralation between PTC INDUSTRIES and Sasken Technologies

Assuming the 90 days trading horizon PTC INDUSTRIES LTD is expected to generate 1.27 times more return on investment than Sasken Technologies. However, PTC INDUSTRIES is 1.27 times more volatile than Sasken Technologies Limited. It trades about 0.09 of its potential returns per unit of risk. Sasken Technologies Limited is currently generating about 0.09 per unit of risk. If you would invest  589,360  in PTC INDUSTRIES LTD on September 17, 2024 and sell it today you would earn a total of  565,700  from holding PTC INDUSTRIES LTD or generate 95.99% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	99.59%
Values	Daily Returns

PTC INDUSTRIES LTD  vs.  Sasken Technologies Limited

PTC INDUSTRIES LTD

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days PTC INDUSTRIES LTD has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's fundamental indicators remain very healthy which may send shares a bit higher in January 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Sasken Technologies

Risk-Adjusted Performance

15 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Sasken Technologies Limited are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain forward-looking signals, Sasken Technologies sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with PTC INDUSTRIES and Sasken Technologies

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

The idea behind PTC INDUSTRIES LTD and Sasken Technologies Limited 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 .