Correlation Between PayPal Holdings and OSK Holdings
Can any of the company-specific risk be diversified away by investing in both PayPal Holdings and OSK Holdings 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 PayPal Holdings and OSK Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PayPal Holdings and OSK Holdings Bhd, you can compare the effects of market volatilities on PayPal Holdings and OSK Holdings 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 PayPal Holdings with a short position of OSK Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of PayPal Holdings and OSK Holdings.
Diversification Opportunities for PayPal Holdings and OSK Holdings
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between PayPal and OSK is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding PayPal Holdings and OSK Holdings Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OSK Holdings Bhd and PayPal Holdings 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 PayPal Holdings are associated (or correlated) with OSK Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OSK Holdings Bhd has no effect on the direction of PayPal Holdings i.e., PayPal Holdings and OSK Holdings go up and down completely randomly.
Pair Corralation between PayPal Holdings and OSK Holdings
Given the investment horizon of 90 days PayPal Holdings is expected to generate 1.35 times more return on investment than OSK Holdings. However, PayPal Holdings is 1.35 times more volatile than OSK Holdings Bhd. It trades about 0.13 of its potential returns per unit of risk. OSK Holdings Bhd is currently generating about 0.04 per unit of risk. If you would invest 6,353 in PayPal Holdings on September 3, 2024 and sell it today you would earn a total of 2,324 from holding PayPal Holdings or generate 36.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PayPal Holdings vs. OSK Holdings Bhd
Performance |
| Timeline |
| PayPal Holdings |
| OSK Holdings Bhd |
PayPal Holdings and OSK Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PayPal Holdings and OSK Holdings
The main advantage of trading using opposite PayPal Holdings and OSK Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PayPal Holdings position performs unexpectedly, OSK Holdings 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 OSK Holdings will offset losses from the drop in OSK Holdings' long position.| PayPal Holdings vs. American Express | PayPal Holdings vs. Capital One Financial | PayPal Holdings vs. Upstart Holdings | PayPal Holdings vs. Ally Financial |
| OSK Holdings vs. Minetech Resources Bhd | OSK Holdings vs. Swift Haulage Bhd | OSK Holdings vs. Insas Bhd | OSK Holdings vs. Bina Darulaman Bhd |
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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