Correlation Between Reitar Logtech and Concrete Pumping

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

By analyzing existing cross correlation between Reitar Logtech Holdings and Concrete Pumping Holdings, you can compare the effects of market volatilities on Reitar Logtech and Concrete Pumping 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 Reitar Logtech with a short position of Concrete Pumping. Check out your portfolio center. Please also check ongoing floating volatility patterns of Reitar Logtech and Concrete Pumping.

Diversification Opportunities for Reitar Logtech and Concrete Pumping

-0.58

Correlation Coefficient

Reitar Logtech  Concrete Pumping

Excellent diversification

The 3 months correlation between Reitar and Concrete is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Reitar Logtech Holdings and Concrete Pumping Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Concrete Pumping Holdings and Reitar Logtech 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 Reitar Logtech Holdings are associated (or correlated) with Concrete Pumping. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Concrete Pumping Holdings has no effect on the direction of Reitar Logtech i.e., Reitar Logtech and Concrete Pumping go up and down completely randomly.

Pair Corralation between Reitar Logtech and Concrete Pumping

Given the investment horizon of 90 days Reitar Logtech is expected to generate 10.36 times less return on investment than Concrete Pumping. In addition to that, Reitar Logtech is 4.26 times more volatile than Concrete Pumping Holdings. It trades about 0.0 of its total potential returns per unit of risk. Concrete Pumping Holdings is currently generating about 0.18 per unit of volatility. If you would invest  590.00  in Concrete Pumping Holdings on September 22, 2024 and sell it today you would earn a total of  70.00  from holding Concrete Pumping Holdings or generate 11.86% return on investment over 90 days.

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

Reitar Logtech Holdings  vs.  Concrete Pumping Holdings

Reitar Logtech Holdings

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Reitar Logtech Holdings are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Reitar Logtech reported solid returns over the last few months and may actually be approaching a breakup point.

Concrete Pumping Holdings

Risk-Adjusted Performance

6 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Concrete Pumping Holdings are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Even with relatively abnormal fundamental indicators, Concrete Pumping reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Reitar Logtech and Concrete Pumping

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

The idea behind Reitar Logtech Holdings and Concrete Pumping Holdings 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.