Correlation Between YD More and Payment Financial
Can any of the company-specific risk be diversified away by investing in both YD More and Payment Financial 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 YD More and Payment Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between YD More Investments and Payment Financial Technologies, you can compare the effects of market volatilities on YD More and Payment Financial 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 YD More with a short position of Payment Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of YD More and Payment Financial.
Diversification Opportunities for YD More and Payment Financial
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between MRIN and Payment is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding YD More Investments and Payment Financial Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Payment Financial and YD More 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 YD More Investments are associated (or correlated) with Payment Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Payment Financial has no effect on the direction of YD More i.e., YD More and Payment Financial go up and down completely randomly.
Pair Corralation between YD More and Payment Financial
Assuming the 90 days trading horizon YD More is expected to generate 8.57 times less return on investment than Payment Financial. But when comparing it to its historical volatility, YD More Investments is 1.73 times less risky than Payment Financial. It trades about 0.09 of its potential returns per unit of risk. Payment Financial Technologies is currently generating about 0.46 of returns per unit of risk over similar time horizon. If you would invest 32,210 in Payment Financial Technologies on October 23, 2024 and sell it today you would earn a total of 11,790 from holding Payment Financial Technologies or generate 36.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 94.12% |
| Values | Daily Returns |
YD More Investments vs. Payment Financial Technologies
Performance |
| Timeline |
| YD More Investments |
| Payment Financial |
YD More and Payment Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with YD More and Payment Financial
The main advantage of trading using opposite YD More and Payment Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if YD More position performs unexpectedly, Payment Financial 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 Payment Financial will offset losses from the drop in Payment Financial's long position.| YD More vs. Bank Leumi Le Israel | YD More vs. Mizrahi Tefahot | YD More vs. Israel Discount Bank | YD More vs. Bank Hapoalim |
| Payment Financial vs. Meitav Dash Investments | Payment Financial vs. Clal Biotechnology Industries | Payment Financial vs. Amot Investments | Payment Financial vs. YD More Investments |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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