Correlation Between PKSHA TECHNOLOGY and General Mills
Can any of the company-specific risk be diversified away by investing in both PKSHA TECHNOLOGY and General Mills 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 General Mills 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 General Mills, you can compare the effects of market volatilities on PKSHA TECHNOLOGY and General Mills 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 General Mills. Check out your portfolio center. Please also check ongoing floating volatility patterns of PKSHA TECHNOLOGY and General Mills.
Diversification Opportunities for PKSHA TECHNOLOGY and General Mills
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between PKSHA and General is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding PKSHA TECHNOLOGY INC and General Mills in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on General Mills 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 General Mills. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of General Mills has no effect on the direction of PKSHA TECHNOLOGY i.e., PKSHA TECHNOLOGY and General Mills go up and down completely randomly.
Pair Corralation between PKSHA TECHNOLOGY and General Mills
Assuming the 90 days horizon PKSHA TECHNOLOGY INC is expected to generate 3.0 times more return on investment than General Mills. However, PKSHA TECHNOLOGY is 3.0 times more volatile than General Mills. It trades about 0.11 of its potential returns per unit of risk. General Mills is currently generating about 0.09 per unit of risk. If you would invest 2,240 in PKSHA TECHNOLOGY INC on September 14, 2024 and sell it today you would earn a total of 180.00 from holding PKSHA TECHNOLOGY INC or generate 8.04% 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. General Mills
Performance |
| Timeline |
| PKSHA TECHNOLOGY INC |
| General Mills |
PKSHA TECHNOLOGY and General Mills Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PKSHA TECHNOLOGY and General Mills
The main advantage of trading using opposite PKSHA TECHNOLOGY and General Mills positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PKSHA TECHNOLOGY position performs unexpectedly, General Mills 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 General Mills will offset losses from the drop in General Mills' long position.| PKSHA TECHNOLOGY vs. Adyen NV | PKSHA TECHNOLOGY vs. Superior Plus Corp | PKSHA TECHNOLOGY vs. SIVERS SEMICONDUCTORS AB | PKSHA TECHNOLOGY vs. Norsk Hydro ASA |
| General Mills vs. PKSHA TECHNOLOGY INC | General Mills vs. MOLSON RS BEVERAGE | General Mills vs. National Beverage Corp | General Mills vs. Algonquin Power Utilities |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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