Correlation Between PSI Software and SMA Solar
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By analyzing existing cross correlation between PSI Software AG and SMA Solar Technology, you can compare the effects of market volatilities on PSI Software and SMA Solar 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 PSI Software with a short position of SMA Solar. Check out your portfolio center. Please also check ongoing floating volatility patterns of PSI Software and SMA Solar.
Diversification Opportunities for PSI Software and SMA Solar
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between PSI and SMA is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding PSI Software AG and SMA Solar Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SMA Solar Technology and PSI Software 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 PSI Software AG are associated (or correlated) with SMA Solar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SMA Solar Technology has no effect on the direction of PSI Software i.e., PSI Software and SMA Solar go up and down completely randomly.
Pair Corralation between PSI Software and SMA Solar
Assuming the 90 days trading horizon PSI Software AG is expected to generate 0.18 times more return on investment than SMA Solar. However, PSI Software AG is 5.51 times less risky than SMA Solar. It trades about 0.05 of its potential returns per unit of risk. SMA Solar Technology is currently generating about -0.1 per unit of risk. If you would invest 2,160 in PSI Software AG on September 3, 2024 and sell it today you would earn a total of 20.00 from holding PSI Software AG or generate 0.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PSI Software AG vs. SMA Solar Technology
Performance |
| Timeline |
| PSI Software AG |
| SMA Solar Technology |
PSI Software and SMA Solar Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PSI Software and SMA Solar
The main advantage of trading using opposite PSI Software and SMA Solar positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PSI Software position performs unexpectedly, SMA Solar 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 SMA Solar will offset losses from the drop in SMA Solar's long position.| PSI Software vs. PUBLIC STORAGE PRFO | PSI Software vs. YOOMA WELLNESS INC | PSI Software vs. CVS Health | PSI Software vs. Major Drilling Group |
| SMA Solar vs. SPORT LISBOA E | SMA Solar vs. Fukuyama Transporting Co | SMA Solar vs. Cardinal Health | SMA Solar vs. NTG Nordic Transport |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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