Correlation Between Penta Ocean and Take-Two Interactive

Can any of the company-specific risk be diversified away by investing in both Penta Ocean and Take-Two Interactive 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 Penta Ocean and Take-Two Interactive into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Penta Ocean Construction Co and Take Two Interactive Software, you can compare the effects of market volatilities on Penta Ocean and Take-Two Interactive 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 Penta Ocean with a short position of Take-Two Interactive. Check out your portfolio center. Please also check ongoing floating volatility patterns of Penta Ocean and Take-Two Interactive.

Diversification Opportunities for Penta Ocean and Take-Two Interactive

0.65

Correlation Coefficient

Penta Ocean  Take-Two Interactive

Poor diversification

The 3 months correlation between Penta and Take-Two is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Penta Ocean Construction Co and Take Two Interactive Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Take Two Interactive and Penta Ocean 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 Penta Ocean Construction Co are associated (or correlated) with Take-Two Interactive. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Take Two Interactive has no effect on the direction of Penta Ocean i.e., Penta Ocean and Take-Two Interactive go up and down completely randomly.

Pair Corralation between Penta Ocean and Take-Two Interactive

Assuming the 90 days horizon Penta Ocean Construction Co is expected to generate 0.76 times more return on investment than Take-Two Interactive. However, Penta Ocean Construction Co is 1.31 times less risky than Take-Two Interactive. It trades about -0.04 of its potential returns per unit of risk. Take Two Interactive Software is currently generating about -0.16 per unit of risk. If you would invest  535.00  in Penta Ocean Construction Co on April 22, 2025 and sell it today you would lose (5.00) from holding Penta Ocean Construction Co or give up 0.93% of portfolio value over 90 days.

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

Penta Ocean Construction Co  vs.  Take Two Interactive Software

Penta Ocean Construc

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Penta Ocean Construction Co are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Penta Ocean may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Take Two Interactive

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Take Two Interactive Software are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, Take-Two Interactive may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Penta Ocean and Take-Two Interactive

The main advantage of trading using opposite Penta Ocean and Take-Two Interactive positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Penta Ocean position performs unexpectedly, Take-Two Interactive 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 Take-Two Interactive will offset losses from the drop in Take-Two Interactive's long position.

The idea behind Penta Ocean Construction Co and Take Two Interactive Software 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.