Correlation Between Boxer Retail and Prosus NV
Can any of the company-specific risk be diversified away by investing in both Boxer Retail and Prosus NV 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 Boxer Retail and Prosus NV into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Boxer Retail and Prosus NV, you can compare the effects of market volatilities on Boxer Retail and Prosus NV 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 Boxer Retail with a short position of Prosus NV. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boxer Retail and Prosus NV.
Diversification Opportunities for Boxer Retail and Prosus NV
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Boxer and Prosus is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding Boxer Retail and Prosus NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Prosus NV and Boxer Retail 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 Boxer Retail are associated (or correlated) with Prosus NV. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Prosus NV has no effect on the direction of Boxer Retail i.e., Boxer Retail and Prosus NV go up and down completely randomly.
Pair Corralation between Boxer Retail and Prosus NV
Assuming the 90 days trading horizon Boxer Retail is expected to generate 2.02 times more return on investment than Prosus NV. However, Boxer Retail is 2.02 times more volatile than Prosus NV. It trades about 0.2 of its potential returns per unit of risk. Prosus NV is currently generating about -0.1 per unit of risk. If you would invest 540,000 in Boxer Retail on October 24, 2024 and sell it today you would earn a total of 136,500 from holding Boxer Retail or generate 25.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 60.66% |
| Values | Daily Returns |
Boxer Retail vs. Prosus NV
Performance |
| Timeline |
| Boxer Retail |
| Prosus NV |
Boxer Retail and Prosus NV Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boxer Retail and Prosus NV
The main advantage of trading using opposite Boxer Retail and Prosus NV positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boxer Retail position performs unexpectedly, Prosus NV 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 Prosus NV will offset losses from the drop in Prosus NV's long position.| Boxer Retail vs. ABSA Bank Limited | Boxer Retail vs. CA Sales Holdings | Boxer Retail vs. Life Healthcare | Boxer Retail vs. Lesaka Technologies |
| Prosus NV vs. Astral Foods | Prosus NV vs. Deneb Investments | Prosus NV vs. Bytes Technology | Prosus NV vs. Boxer Retail |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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