Correlation Between Palantir Technologies and Telecom Argentina

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

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

Diversification Opportunities for Palantir Technologies and Telecom Argentina

-0.61

Correlation Coefficient

Palantir Technologies  Telecom Argentina

Excellent diversification

The 3 months correlation between Palantir and Telecom is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Palantir Technologies and Telecom Argentina in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Telecom Argentina 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 Telecom Argentina. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Telecom Argentina has no effect on the direction of Palantir Technologies i.e., Palantir Technologies and Telecom Argentina go up and down completely randomly.

Pair Corralation between Palantir Technologies and Telecom Argentina

Assuming the 90 days trading horizon Palantir Technologies is expected to generate 1.55 times more return on investment than Telecom Argentina. However, Palantir Technologies is 1.55 times more volatile than Telecom Argentina. It trades about 0.27 of its potential returns per unit of risk. Telecom Argentina is currently generating about 0.01 per unit of risk. If you would invest  3,630,000  in Palantir Technologies on April 22, 2025 and sell it today you would earn a total of  2,865,000  from holding Palantir Technologies or generate 78.93% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	98.36%
Values	Daily Returns

Palantir Technologies  vs.  Telecom Argentina

Palantir Technologies

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Palantir Technologies are ranked lower than 21 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Palantir Technologies sustained solid returns over the last few months and may actually be approaching a breakup point.

Telecom Argentina

Risk-Adjusted Performance

Very Weak

Over the last 90 days Telecom Argentina has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong fundamental drivers, Telecom Argentina is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Palantir Technologies and Telecom Argentina

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

The idea behind Palantir Technologies and Telecom Argentina 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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.