Correlation Between PETCO HEALTH and Tradegate
Can any of the company-specific risk be diversified away by investing in both PETCO HEALTH and Tradegate 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 PETCO HEALTH and Tradegate into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PETCO HEALTH CLA and Tradegate AG Wertpapierhandelsbank, you can compare the effects of market volatilities on PETCO HEALTH and Tradegate 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 PETCO HEALTH with a short position of Tradegate. Check out your portfolio center. Please also check ongoing floating volatility patterns of PETCO HEALTH and Tradegate.
Diversification Opportunities for PETCO HEALTH and Tradegate
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between PETCO and Tradegate is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding PETCO HEALTH CLA and Tradegate AG Wertpapierhandels in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tradegate AG Wertpap and PETCO HEALTH 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 PETCO HEALTH CLA are associated (or correlated) with Tradegate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tradegate AG Wertpap has no effect on the direction of PETCO HEALTH i.e., PETCO HEALTH and Tradegate go up and down completely randomly.
Pair Corralation between PETCO HEALTH and Tradegate
Assuming the 90 days horizon PETCO HEALTH CLA is expected to generate 16.25 times more return on investment than Tradegate. However, PETCO HEALTH is 16.25 times more volatile than Tradegate AG Wertpapierhandelsbank. It trades about 0.13 of its potential returns per unit of risk. Tradegate AG Wertpapierhandelsbank is currently generating about -0.19 per unit of risk. If you would invest 402.00 in PETCO HEALTH CLA on September 13, 2024 and sell it today you would earn a total of 67.00 from holding PETCO HEALTH CLA or generate 16.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
PETCO HEALTH CLA vs. Tradegate AG Wertpapierhandels
Performance |
| Timeline |
| PETCO HEALTH CLA |
| Tradegate AG Wertpap |
PETCO HEALTH and Tradegate Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PETCO HEALTH and Tradegate
The main advantage of trading using opposite PETCO HEALTH and Tradegate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PETCO HEALTH position performs unexpectedly, Tradegate 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 Tradegate will offset losses from the drop in Tradegate's long position.| PETCO HEALTH vs. MITSUBISHI STEEL MFG | PETCO HEALTH vs. COSMOSTEEL HLDGS | PETCO HEALTH vs. SANOK RUBBER ZY | PETCO HEALTH vs. Nippon Steel |
| Tradegate vs. Superior Plus Corp | Tradegate vs. SIVERS SEMICONDUCTORS AB | Tradegate vs. CHINA HUARONG ENERHD 50 | Tradegate vs. NORDIC HALIBUT AS |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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