Correlation Between AOYAMA TRADING and PICKN PAY
Can any of the company-specific risk be diversified away by investing in both AOYAMA TRADING and PICKN PAY 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 AOYAMA TRADING and PICKN PAY into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AOYAMA TRADING and PICKN PAY STORES, you can compare the effects of market volatilities on AOYAMA TRADING and PICKN PAY 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 AOYAMA TRADING with a short position of PICKN PAY. Check out your portfolio center. Please also check ongoing floating volatility patterns of AOYAMA TRADING and PICKN PAY.
Diversification Opportunities for AOYAMA TRADING and PICKN PAY
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between AOYAMA and PICKN is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding AOYAMA TRADING and PICKN PAY STORES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PICKN PAY STORES and AOYAMA TRADING 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 AOYAMA TRADING are associated (or correlated) with PICKN PAY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PICKN PAY STORES has no effect on the direction of AOYAMA TRADING i.e., AOYAMA TRADING and PICKN PAY go up and down completely randomly.
Pair Corralation between AOYAMA TRADING and PICKN PAY
Assuming the 90 days horizon AOYAMA TRADING is expected to generate 3.0 times more return on investment than PICKN PAY. However, AOYAMA TRADING is 3.0 times more volatile than PICKN PAY STORES. It trades about 0.39 of its potential returns per unit of risk. PICKN PAY STORES is currently generating about 0.34 per unit of risk. If you would invest 780.00 in AOYAMA TRADING on September 1, 2024 and sell it today you would earn a total of 620.00 from holding AOYAMA TRADING or generate 79.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
AOYAMA TRADING vs. PICKN PAY STORES
Performance |
| Timeline |
| AOYAMA TRADING |
| PICKN PAY STORES |
AOYAMA TRADING and PICKN PAY Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AOYAMA TRADING and PICKN PAY
The main advantage of trading using opposite AOYAMA TRADING and PICKN PAY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AOYAMA TRADING position performs unexpectedly, PICKN PAY 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 PICKN PAY will offset losses from the drop in PICKN PAY's long position.| AOYAMA TRADING vs. Diamyd Medical AB | AOYAMA TRADING vs. AVITA Medical | AOYAMA TRADING vs. PennyMac Mortgage Investment | AOYAMA TRADING vs. IMAGIN MEDICAL INC |
| PICKN PAY vs. AOYAMA TRADING | PICKN PAY vs. ON SEMICONDUCTOR | PICKN PAY vs. Taiwan Semiconductor Manufacturing | PICKN PAY vs. BE Semiconductor Industries |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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