Correlation Between Palantir Technologies and Viskase Companies

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

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

Diversification Opportunities for Palantir Technologies and Viskase Companies

0.74

Correlation Coefficient

Palantir Technologies  Viskase Companies

Poor diversification

The 3 months correlation between Palantir and Viskase is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Palantir Technologies and Viskase Companies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Viskase Companies and Palantir Technologies 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 Palantir Technologies are associated (or correlated) with Viskase Companies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Viskase Companies has no effect on the direction of Palantir Technologies i.e., Palantir Technologies and Viskase Companies go up and down completely randomly.

Pair Corralation between Palantir Technologies and Viskase Companies

If you would invest  3,460  in Palantir Technologies on July 11, 2024 and sell it today you would earn a total of  685.00  from holding Palantir Technologies or generate 19.8% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	4.35%
Values	Daily Returns

Palantir Technologies  vs.  Viskase Companies

Palantir Technologies

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Palantir Technologies are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Even with relatively abnormal basic indicators, Palantir Technologies reported solid returns over the last few months and may actually be approaching a breakup point.

Viskase Companies

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Viskase Companies has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Viskase Companies is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Palantir Technologies and Viskase Companies

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

The idea behind Palantir Technologies and Viskase Companies 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.