Correlation Between IPG Photonics and Papaya Growth
Can any of the company-specific risk be diversified away by investing in both IPG Photonics and Papaya Growth 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 IPG Photonics and Papaya Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between IPG Photonics and Papaya Growth Opportunity, you can compare the effects of market volatilities on IPG Photonics and Papaya Growth 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 IPG Photonics with a short position of Papaya Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of IPG Photonics and Papaya Growth.
Diversification Opportunities for IPG Photonics and Papaya Growth
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between IPG and Papaya is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding IPG Photonics and Papaya Growth Opportunity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Papaya Growth Opportunity and IPG Photonics 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 IPG Photonics are associated (or correlated) with Papaya Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Papaya Growth Opportunity has no effect on the direction of IPG Photonics i.e., IPG Photonics and Papaya Growth go up and down completely randomly.
Pair Corralation between IPG Photonics and Papaya Growth
If you would invest 1,119 in Papaya Growth Opportunity on September 2, 2024 and sell it today you would earn a total of 0.00 from holding Papaya Growth Opportunity or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
IPG Photonics vs. Papaya Growth Opportunity
Performance |
| Timeline |
| IPG Photonics |
| Papaya Growth Opportunity |
IPG Photonics and Papaya Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IPG Photonics and Papaya Growth
The main advantage of trading using opposite IPG Photonics and Papaya Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IPG Photonics position performs unexpectedly, Papaya Growth 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 Papaya Growth will offset losses from the drop in Papaya Growth's long position.| IPG Photonics vs. Teradyne | IPG Photonics vs. Ultra Clean Holdings | IPG Photonics vs. Onto Innovation | IPG Photonics vs. Entegris |
| Papaya Growth vs. Life Time Group | Papaya Growth vs. Acco Brands | Papaya Growth vs. Afya | Papaya Growth vs. Bright Scholar Education |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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