Correlation Between PARKEN Sport and Postal Savings
Can any of the company-specific risk be diversified away by investing in both PARKEN Sport and Postal Savings 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 PARKEN Sport and Postal Savings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PARKEN Sport Entertainment and Postal Savings Bank, you can compare the effects of market volatilities on PARKEN Sport and Postal Savings 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 PARKEN Sport with a short position of Postal Savings. Check out your portfolio center. Please also check ongoing floating volatility patterns of PARKEN Sport and Postal Savings.
Diversification Opportunities for PARKEN Sport and Postal Savings
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between PARKEN and Postal is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding PARKEN Sport Entertainment and Postal Savings Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Postal Savings Bank and PARKEN Sport 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 PARKEN Sport Entertainment are associated (or correlated) with Postal Savings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Postal Savings Bank has no effect on the direction of PARKEN Sport i.e., PARKEN Sport and Postal Savings go up and down completely randomly.
Pair Corralation between PARKEN Sport and Postal Savings
Assuming the 90 days horizon PARKEN Sport is expected to generate 2.49 times less return on investment than Postal Savings. But when comparing it to its historical volatility, PARKEN Sport Entertainment is 1.14 times less risky than Postal Savings. It trades about 0.04 of its potential returns per unit of risk. Postal Savings Bank is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 47.00 in Postal Savings Bank on September 2, 2024 and sell it today you would earn a total of 6.00 from holding Postal Savings Bank or generate 12.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PARKEN Sport Entertainment vs. Postal Savings Bank
Performance |
| Timeline |
| PARKEN Sport Enterta |
| Postal Savings Bank |
PARKEN Sport and Postal Savings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PARKEN Sport and Postal Savings
The main advantage of trading using opposite PARKEN Sport and Postal Savings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PARKEN Sport position performs unexpectedly, Postal Savings 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 Postal Savings will offset losses from the drop in Postal Savings' long position.| PARKEN Sport vs. DAIRY FARM INTL | PARKEN Sport vs. Chongqing Machinery Electric | PARKEN Sport vs. Nufarm Limited | PARKEN Sport vs. CNVISION MEDIA |
| Postal Savings vs. TERADATA | Postal Savings vs. DATANG INTL POW | Postal Savings vs. National Storage Affiliates | Postal Savings vs. INFORMATION SVC GRP |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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