Correlation Between Prosus NV and Leafbuyer Technologies
Can any of the company-specific risk be diversified away by investing in both Prosus NV and Leafbuyer Technologies 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 Prosus NV and Leafbuyer Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Prosus NV ADR and Leafbuyer Technologies, you can compare the effects of market volatilities on Prosus NV and Leafbuyer Technologies 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 Prosus NV with a short position of Leafbuyer Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Prosus NV and Leafbuyer Technologies.
Diversification Opportunities for Prosus NV and Leafbuyer Technologies
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Prosus and Leafbuyer is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Prosus NV ADR and Leafbuyer Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Leafbuyer Technologies and Prosus NV 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 Prosus NV ADR are associated (or correlated) with Leafbuyer Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Leafbuyer Technologies has no effect on the direction of Prosus NV i.e., Prosus NV and Leafbuyer Technologies go up and down completely randomly.
Pair Corralation between Prosus NV and Leafbuyer Technologies
Assuming the 90 days horizon Prosus NV ADR is expected to under-perform the Leafbuyer Technologies. But the pink sheet apears to be less risky and, when comparing its historical volatility, Prosus NV ADR is 15.12 times less risky than Leafbuyer Technologies. The pink sheet trades about -0.13 of its potential returns per unit of risk. The Leafbuyer Technologies is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 1.00 in Leafbuyer Technologies on August 25, 2024 and sell it today you would earn a total of 0.30 from holding Leafbuyer Technologies or generate 30.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Prosus NV ADR vs. Leafbuyer Technologies
Performance |
| Timeline |
| Prosus NV ADR |
| Leafbuyer Technologies |
Prosus NV and Leafbuyer Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Prosus NV and Leafbuyer Technologies
The main advantage of trading using opposite Prosus NV and Leafbuyer Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Prosus NV position performs unexpectedly, Leafbuyer Technologies 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 Leafbuyer Technologies will offset losses from the drop in Leafbuyer Technologies' long position.| Prosus NV vs. Ping An Insurance | Prosus NV vs. Prosus | Prosus NV vs. Meituan ADR | Prosus NV vs. Murata Manufacturing |
| Leafbuyer Technologies vs. Tencent Holdings | Leafbuyer Technologies vs. Trivago NV | Leafbuyer Technologies vs. YY Inc Class | Leafbuyer Technologies vs. DouYu International Holdings |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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