Correlation Between PLATO GOLD and JERONIMO MARTINS

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

By analyzing existing cross correlation between PLATO GOLD P and JERONIMO MARTINS UNADR2, you can compare the effects of market volatilities on PLATO GOLD and JERONIMO MARTINS 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 PLATO GOLD with a short position of JERONIMO MARTINS. Check out your portfolio center. Please also check ongoing floating volatility patterns of PLATO GOLD and JERONIMO MARTINS.

Diversification Opportunities for PLATO GOLD and JERONIMO MARTINS

-0.36

Correlation Coefficient

PLATO GOLD  JERONIMO MARTINS

Very good diversification

The 3 months correlation between PLATO and JERONIMO is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding PLATO GOLD P and JERONIMO MARTINS UNADR2 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JERONIMO MARTINS UNADR2 and PLATO GOLD 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 PLATO GOLD P are associated (or correlated) with JERONIMO MARTINS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JERONIMO MARTINS UNADR2 has no effect on the direction of PLATO GOLD i.e., PLATO GOLD and JERONIMO MARTINS go up and down completely randomly.

Pair Corralation between PLATO GOLD and JERONIMO MARTINS

Assuming the 90 days horizon PLATO GOLD P is expected to generate 12.71 times more return on investment than JERONIMO MARTINS. However, PLATO GOLD is 12.71 times more volatile than JERONIMO MARTINS UNADR2. It trades about 0.06 of its potential returns per unit of risk. JERONIMO MARTINS UNADR2 is currently generating about 0.05 per unit of risk. If you would invest  1.55  in PLATO GOLD P on April 25, 2025 and sell it today you would lose (0.65) from holding PLATO GOLD P or give up 41.94% of portfolio value over 90 days.

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

PLATO GOLD P  vs.  JERONIMO MARTINS UNADR2

PLATO GOLD P

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in PLATO GOLD P are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, PLATO GOLD reported solid returns over the last few months and may actually be approaching a breakup point.

JERONIMO MARTINS UNADR2

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in JERONIMO MARTINS UNADR2 are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable primary indicators, JERONIMO MARTINS is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with PLATO GOLD and JERONIMO MARTINS

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

The idea behind PLATO GOLD P and JERONIMO MARTINS UNADR2 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.