Correlation Between Prosafe SE and Currys PLC
Can any of the company-specific risk be diversified away by investing in both Prosafe SE and Currys PLC 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 Prosafe SE and Currys PLC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Prosafe SE and Currys PLC, you can compare the effects of market volatilities on Prosafe SE and Currys PLC 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 Prosafe SE with a short position of Currys PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Prosafe SE and Currys PLC.
Diversification Opportunities for Prosafe SE and Currys PLC
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between Prosafe and Currys is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Prosafe SE and Currys PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Currys PLC and Prosafe SE 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 Prosafe SE are associated (or correlated) with Currys PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Currys PLC has no effect on the direction of Prosafe SE i.e., Prosafe SE and Currys PLC go up and down completely randomly.
Pair Corralation between Prosafe SE and Currys PLC
Assuming the 90 days horizon Prosafe SE is expected to generate 18.07 times more return on investment than Currys PLC. However, Prosafe SE is 18.07 times more volatile than Currys PLC. It trades about 0.14 of its potential returns per unit of risk. Currys PLC is currently generating about 0.02 per unit of risk. If you would invest 69.00 in Prosafe SE on October 25, 2024 and sell it today you would earn a total of 12.00 from holding Prosafe SE or generate 17.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Prosafe SE vs. Currys PLC
Performance |
| Timeline |
| Prosafe SE |
| Currys PLC |
Prosafe SE and Currys PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Prosafe SE and Currys PLC
The main advantage of trading using opposite Prosafe SE and Currys PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Prosafe SE position performs unexpectedly, Currys PLC 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 Currys PLC will offset losses from the drop in Currys PLC's long position.| Prosafe SE vs. NIGHTINGALE HEALTH EO | Prosafe SE vs. Phibro Animal Health | Prosafe SE vs. CARDINAL HEALTH | Prosafe SE vs. RCS MediaGroup SpA |
| Currys PLC vs. PICKN PAY STORES | Currys PLC vs. Burlington Stores | Currys PLC vs. QINGCI GAMES INC | Currys PLC vs. Games Workshop Group |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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