Correlation Between SOEDER SPORTFISKE and PennyMac Mortgage
Can any of the company-specific risk be diversified away by investing in both SOEDER SPORTFISKE and PennyMac Mortgage 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 SOEDER SPORTFISKE and PennyMac Mortgage into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SOEDER SPORTFISKE AB and PennyMac Mortgage Investment, you can compare the effects of market volatilities on SOEDER SPORTFISKE and PennyMac Mortgage 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 SOEDER SPORTFISKE with a short position of PennyMac Mortgage. Check out your portfolio center. Please also check ongoing floating volatility patterns of SOEDER SPORTFISKE and PennyMac Mortgage.
Diversification Opportunities for SOEDER SPORTFISKE and PennyMac Mortgage
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between SOEDER and PennyMac is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding SOEDER SPORTFISKE AB and PennyMac Mortgage Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PennyMac Mortgage and SOEDER SPORTFISKE 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 SOEDER SPORTFISKE AB are associated (or correlated) with PennyMac Mortgage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PennyMac Mortgage has no effect on the direction of SOEDER SPORTFISKE i.e., SOEDER SPORTFISKE and PennyMac Mortgage go up and down completely randomly.
Pair Corralation between SOEDER SPORTFISKE and PennyMac Mortgage
Assuming the 90 days horizon SOEDER SPORTFISKE AB is expected to generate 2.36 times more return on investment than PennyMac Mortgage. However, SOEDER SPORTFISKE is 2.36 times more volatile than PennyMac Mortgage Investment. It trades about 0.16 of its potential returns per unit of risk. PennyMac Mortgage Investment is currently generating about 0.09 per unit of risk. If you would invest 217.00 in SOEDER SPORTFISKE AB on November 7, 2024 and sell it today you would earn a total of 31.00 from holding SOEDER SPORTFISKE AB or generate 14.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SOEDER SPORTFISKE AB vs. PennyMac Mortgage Investment
Performance |
| Timeline |
| SOEDER SPORTFISKE |
| PennyMac Mortgage |
SOEDER SPORTFISKE and PennyMac Mortgage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SOEDER SPORTFISKE and PennyMac Mortgage
The main advantage of trading using opposite SOEDER SPORTFISKE and PennyMac Mortgage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SOEDER SPORTFISKE position performs unexpectedly, PennyMac Mortgage 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 PennyMac Mortgage will offset losses from the drop in PennyMac Mortgage's long position.| SOEDER SPORTFISKE vs. Booking Holdings | SOEDER SPORTFISKE vs. Oriental Land Co | SOEDER SPORTFISKE vs. ANTA Sports Products | SOEDER SPORTFISKE vs. Li Ning Company |
| PennyMac Mortgage vs. Crown Castle International | PennyMac Mortgage vs. Equinix | PennyMac Mortgage vs. W P Carey | PennyMac Mortgage vs. Gaming and Leisure |
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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