Correlation Between SinterCast and Polygiene

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

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

Diversification Opportunities for SinterCast and Polygiene

0.83

Correlation Coefficient

SinterCast  Polygiene

Very poor diversification

The 3 months correlation between SinterCast and Polygiene is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding SinterCast AB and Polygiene AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Polygiene AB and SinterCast 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 SinterCast AB are associated (or correlated) with Polygiene. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Polygiene AB has no effect on the direction of SinterCast i.e., SinterCast and Polygiene go up and down completely randomly.

Pair Corralation between SinterCast and Polygiene

Assuming the 90 days trading horizon SinterCast is expected to generate 21.13 times less return on investment than Polygiene. But when comparing it to its historical volatility, SinterCast AB is 2.59 times less risky than Polygiene. It trades about 0.0 of its potential returns per unit of risk. Polygiene AB is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  987.00  in Polygiene AB on April 22, 2025 and sell it today you would earn a total of  208.00  from holding Polygiene AB or generate 21.07% return on investment over 90 days.

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

SinterCast AB  vs.  Polygiene AB

SinterCast AB

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in SinterCast AB are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, SinterCast unveiled solid returns over the last few months and may actually be approaching a breakup point.

Polygiene AB

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Polygiene AB are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Polygiene unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with SinterCast and Polygiene

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

The idea behind SinterCast AB and Polygiene AB 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.