Correlation Between SPENN Technology and CARPENTER

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

By analyzing existing cross correlation between SPENN Technology AS and CARPENTER TECHNOLOGY P, you can compare the effects of market volatilities on SPENN Technology and CARPENTER 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 SPENN Technology with a short position of CARPENTER. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPENN Technology and CARPENTER.

Diversification Opportunities for SPENN Technology and CARPENTER

0.0

Correlation Coefficient

SPENN Technology  CARPENTER

Pay attention - limited upside

The 3 months correlation between SPENN and CARPENTER is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding SPENN Technology AS and CARPENTER TECHNOLOGY P in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CARPENTER TECHNOLOGY and SPENN 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 SPENN Technology AS are associated (or correlated) with CARPENTER. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CARPENTER TECHNOLOGY has no effect on the direction of SPENN Technology i.e., SPENN Technology and CARPENTER go up and down completely randomly.

Pair Corralation between SPENN Technology and CARPENTER

If you would invest  9,960  in CARPENTER TECHNOLOGY P on September 24, 2024 and sell it today you would earn a total of  50.00  from holding CARPENTER TECHNOLOGY P or generate 0.5% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	96.92%
Values	Daily Returns

SPENN Technology AS  vs.  CARPENTER TECHNOLOGY P

SPENN Technology

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SPENN Technology AS has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, SPENN Technology is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

CARPENTER TECHNOLOGY

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in CARPENTER TECHNOLOGY P are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, CARPENTER is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with SPENN Technology and CARPENTER

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

The idea behind SPENN Technology AS and CARPENTER TECHNOLOGY P 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.

Check out your portfolio center.

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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.