Correlation Between PagSeguro Digital and Marqeta
Can any of the company-specific risk be diversified away by investing in both PagSeguro Digital and Marqeta 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 PagSeguro Digital and Marqeta into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PagSeguro Digital and Marqeta, you can compare the effects of market volatilities on PagSeguro Digital and Marqeta 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 PagSeguro Digital with a short position of Marqeta. Check out your portfolio center. Please also check ongoing floating volatility patterns of PagSeguro Digital and Marqeta.
Diversification Opportunities for PagSeguro Digital and Marqeta
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between PagSeguro and Marqeta is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding PagSeguro Digital and Marqeta in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marqeta and PagSeguro Digital 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 PagSeguro Digital are associated (or correlated) with Marqeta. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marqeta has no effect on the direction of PagSeguro Digital i.e., PagSeguro Digital and Marqeta go up and down completely randomly.
Pair Corralation between PagSeguro Digital and Marqeta
Given the investment horizon of 90 days PagSeguro Digital is expected to under-perform the Marqeta. But the stock apears to be less risky and, when comparing its historical volatility, PagSeguro Digital is 5.42 times less risky than Marqeta. The stock trades about -0.23 of its potential returns per unit of risk. The Marqeta is currently generating about -0.04 of returns per unit of risk over similar time horizon. If you would invest 518.00 in Marqeta on August 24, 2024 and sell it today you would lose (109.00) from holding Marqeta or give up 21.04% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PagSeguro Digital vs. Marqeta
Performance |
| Timeline |
| PagSeguro Digital |
| Marqeta |
PagSeguro Digital and Marqeta Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PagSeguro Digital and Marqeta
The main advantage of trading using opposite PagSeguro Digital and Marqeta positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PagSeguro Digital position performs unexpectedly, Marqeta 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 Marqeta will offset losses from the drop in Marqeta's long position.| PagSeguro Digital vs. Marqeta | PagSeguro Digital vs. StoneCo | PagSeguro Digital vs. Confluent | PagSeguro Digital vs. Dlocal |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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