Correlation Between Procter Gamble and Surf Air
Can any of the company-specific risk be diversified away by investing in both Procter Gamble and Surf Air 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 Procter Gamble and Surf Air into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Procter Gamble and Surf Air Mobility, you can compare the effects of market volatilities on Procter Gamble and Surf Air 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 Procter Gamble with a short position of Surf Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of Procter Gamble and Surf Air.
Diversification Opportunities for Procter Gamble and Surf Air
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Procter and Surf is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Procter Gamble and Surf Air Mobility in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Surf Air Mobility and Procter Gamble 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 Procter Gamble are associated (or correlated) with Surf Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Surf Air Mobility has no effect on the direction of Procter Gamble i.e., Procter Gamble and Surf Air go up and down completely randomly.
Pair Corralation between Procter Gamble and Surf Air
Allowing for the 90-day total investment horizon Procter Gamble is expected to generate 12.2 times less return on investment than Surf Air. But when comparing it to its historical volatility, Procter Gamble is 7.51 times less risky than Surf Air. It trades about 0.17 of its potential returns per unit of risk. Surf Air Mobility is currently generating about 0.27 of returns per unit of risk over similar time horizon. If you would invest 174.00 in Surf Air Mobility on August 27, 2024 and sell it today you would earn a total of 94.00 from holding Surf Air Mobility or generate 54.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Procter Gamble vs. Surf Air Mobility
Performance |
| Timeline |
| Procter Gamble |
| Surf Air Mobility |
Procter Gamble and Surf Air Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Procter Gamble and Surf Air
The main advantage of trading using opposite Procter Gamble and Surf Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Procter Gamble position performs unexpectedly, Surf Air 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 Surf Air will offset losses from the drop in Surf Air's long position.| Procter Gamble vs. Unilever PLC ADR | Procter Gamble vs. Estee Lauder Companies | Procter Gamble vs. ELF Beauty | Procter Gamble vs. Coty Inc |
| Surf Air vs. Canlan Ice Sports | Surf Air vs. Academy Sports Outdoors | Surf Air vs. Verra Mobility Corp | Surf Air vs. Nyxoah |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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