Correlation Between Caseys General and PICKN PAY
Can any of the company-specific risk be diversified away by investing in both Caseys General 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 Caseys General and PICKN PAY into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Caseys General Stores and PICKN PAY STORES, you can compare the effects of market volatilities on Caseys General 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 Caseys General with a short position of PICKN PAY. Check out your portfolio center. Please also check ongoing floating volatility patterns of Caseys General and PICKN PAY.
Diversification Opportunities for Caseys General and PICKN PAY
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Caseys and PICKN is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Caseys General Stores 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 Caseys General 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 Caseys General Stores 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 Caseys General i.e., Caseys General and PICKN PAY go up and down completely randomly.
Pair Corralation between Caseys General and PICKN PAY
Assuming the 90 days trading horizon Caseys General is expected to generate 1.95 times less return on investment than PICKN PAY. But when comparing it to its historical volatility, Caseys General Stores is 1.2 times less risky than PICKN PAY. It trades about 0.21 of its potential returns per unit of risk. PICKN PAY STORES is currently generating about 0.34 of returns per unit of risk over similar time horizon. If you would invest 127.00 in PICKN PAY STORES on September 1, 2024 and sell it today you would earn a total of 25.00 from holding PICKN PAY STORES or generate 19.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Caseys General Stores vs. PICKN PAY STORES
Performance |
| Timeline |
| Caseys General Stores |
| PICKN PAY STORES |
Caseys General and PICKN PAY Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Caseys General and PICKN PAY
The main advantage of trading using opposite Caseys General and PICKN PAY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Caseys General 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.| Caseys General vs. Apple Inc | Caseys General vs. Apple Inc | Caseys General vs. Apple Inc | Caseys General vs. Apple 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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