Correlation Between Polaris Infrastructure and Maxim Power

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

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

Diversification Opportunities for Polaris Infrastructure and Maxim Power

-0.12

Correlation Coefficient

Polaris Infrastructure  Maxim Power

Good diversification

The 3 months correlation between Polaris and Maxim is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Polaris Infrastructure and Maxim Power Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Maxim Power Corp and Polaris Infrastructure 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 Polaris Infrastructure are associated (or correlated) with Maxim Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Maxim Power Corp has no effect on the direction of Polaris Infrastructure i.e., Polaris Infrastructure and Maxim Power go up and down completely randomly.

Pair Corralation between Polaris Infrastructure and Maxim Power

Assuming the 90 days trading horizon Polaris Infrastructure is expected to generate 0.78 times more return on investment than Maxim Power. However, Polaris Infrastructure is 1.28 times less risky than Maxim Power. It trades about 0.2 of its potential returns per unit of risk. Maxim Power Corp is currently generating about 0.04 per unit of risk. If you would invest  1,194  in Polaris Infrastructure on July 24, 2025 and sell it today you would earn a total of  190.00  from holding Polaris Infrastructure or generate 15.91% return on investment over 90 days.

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

Polaris Infrastructure  vs.  Maxim Power Corp

Polaris Infrastructure

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Polaris Infrastructure are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating technical and fundamental indicators, Polaris Infrastructure displayed solid returns over the last few months and may actually be approaching a breakup point.

Maxim Power Corp

Risk-Adjusted Performance

Soft

Compared to the overall equity markets, risk-adjusted returns on investments in Maxim Power Corp are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy technical and fundamental indicators, Maxim Power is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Polaris Infrastructure and Maxim Power

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

The idea behind Polaris Infrastructure and Maxim Power Corp 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.