Correlation Between PKSHA TECHNOLOGY and WICKES GROUP
Can any of the company-specific risk be diversified away by investing in both PKSHA TECHNOLOGY and WICKES GROUP 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 PKSHA TECHNOLOGY and WICKES GROUP into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PKSHA TECHNOLOGY INC and WICKES GROUP PLC, you can compare the effects of market volatilities on PKSHA TECHNOLOGY and WICKES GROUP 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 PKSHA TECHNOLOGY with a short position of WICKES GROUP. Check out your portfolio center. Please also check ongoing floating volatility patterns of PKSHA TECHNOLOGY and WICKES GROUP.
Diversification Opportunities for PKSHA TECHNOLOGY and WICKES GROUP
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between PKSHA and WICKES is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding PKSHA TECHNOLOGY INC and WICKES GROUP PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WICKES GROUP PLC and PKSHA TECHNOLOGY 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 PKSHA TECHNOLOGY INC are associated (or correlated) with WICKES GROUP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WICKES GROUP PLC has no effect on the direction of PKSHA TECHNOLOGY i.e., PKSHA TECHNOLOGY and WICKES GROUP go up and down completely randomly.
Pair Corralation between PKSHA TECHNOLOGY and WICKES GROUP
Assuming the 90 days horizon PKSHA TECHNOLOGY INC is expected to generate 2.64 times more return on investment than WICKES GROUP. However, PKSHA TECHNOLOGY is 2.64 times more volatile than WICKES GROUP PLC. It trades about 0.05 of its potential returns per unit of risk. WICKES GROUP PLC is currently generating about 0.05 per unit of risk. If you would invest 1,930 in PKSHA TECHNOLOGY INC on September 3, 2024 and sell it today you would earn a total of 670.00 from holding PKSHA TECHNOLOGY INC or generate 34.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PKSHA TECHNOLOGY INC vs. WICKES GROUP PLC
Performance |
| Timeline |
| PKSHA TECHNOLOGY INC |
| WICKES GROUP PLC |
PKSHA TECHNOLOGY and WICKES GROUP Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PKSHA TECHNOLOGY and WICKES GROUP
The main advantage of trading using opposite PKSHA TECHNOLOGY and WICKES GROUP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PKSHA TECHNOLOGY position performs unexpectedly, WICKES GROUP 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 WICKES GROUP will offset losses from the drop in WICKES GROUP's long position.| PKSHA TECHNOLOGY vs. Microsoft | PKSHA TECHNOLOGY vs. CrowdStrike Holdings | PKSHA TECHNOLOGY vs. VeriSign | PKSHA TECHNOLOGY vs. Palantir Technologies |
| WICKES GROUP vs. ScanSource | WICKES GROUP vs. FARO Technologies | WICKES GROUP vs. IMPERIAL TOBACCO | WICKES GROUP vs. PKSHA TECHNOLOGY INC |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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