Correlation Between PNC Infratech and Computer Age

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

By analyzing existing cross correlation between PNC Infratech Limited and Computer Age Management, you can compare the effects of market volatilities on PNC Infratech and Computer Age 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 PNC Infratech with a short position of Computer Age. Check out your portfolio center. Please also check ongoing floating volatility patterns of PNC Infratech and Computer Age.

Diversification Opportunities for PNC Infratech and Computer Age

0.87

Correlation Coefficient

PNC Infratech  Computer Age

Very poor diversification

The 3 months correlation between PNC and Computer is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding PNC Infratech Limited and Computer Age Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Computer Age Management and PNC Infratech 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 PNC Infratech Limited are associated (or correlated) with Computer Age. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Computer Age Management has no effect on the direction of PNC Infratech i.e., PNC Infratech and Computer Age go up and down completely randomly.

Pair Corralation between PNC Infratech and Computer Age

Assuming the 90 days trading horizon PNC Infratech Limited is expected to generate 0.92 times more return on investment than Computer Age. However, PNC Infratech Limited is 1.08 times less risky than Computer Age. It trades about 0.1 of its potential returns per unit of risk. Computer Age Management is currently generating about 0.04 per unit of risk. If you would invest  28,085  in PNC Infratech Limited on April 23, 2025 and sell it today you would earn a total of  3,365  from holding PNC Infratech Limited or generate 11.98% return on investment over 90 days.

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

PNC Infratech Limited  vs.  Computer Age Management

PNC Infratech Limited

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in PNC Infratech Limited are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak technical and fundamental indicators, PNC Infratech may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Computer Age Management

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Computer Age Management are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Computer Age is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with PNC Infratech and Computer Age

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

The idea behind PNC Infratech Limited and Computer Age Management 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..