Correlation Between Pulse Oil and Kraken Robotics

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

By analyzing existing cross correlation between Pulse Oil Corp and Kraken Robotics, you can compare the effects of market volatilities on Pulse Oil and Kraken Robotics 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 Pulse Oil with a short position of Kraken Robotics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pulse Oil and Kraken Robotics.

Diversification Opportunities for Pulse Oil and Kraken Robotics

-0.78

Correlation Coefficient

Pulse Oil  Kraken Robotics

Pay attention - limited upside

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

Pair Corralation between Pulse Oil and Kraken Robotics

Assuming the 90 days horizon Pulse Oil Corp is expected to under-perform the Kraken Robotics. In addition to that, Pulse Oil is 3.7 times more volatile than Kraken Robotics. It trades about -0.02 of its total potential returns per unit of risk. Kraken Robotics is currently generating about 0.03 per unit of volatility. If you would invest  243.00  in Kraken Robotics on September 20, 2024 and sell it today you would earn a total of  1.00  from holding Kraken Robotics or generate 0.41% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	95.65%
Values	Daily Returns

Pulse Oil Corp  vs.  Kraken Robotics

Pulse Oil Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Pulse Oil Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in January 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Kraken Robotics

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Kraken Robotics are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Kraken Robotics showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Pulse Oil and Kraken Robotics

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

The idea behind Pulse Oil Corp and Kraken Robotics 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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.