Correlation Between PayPal Holdings and Group Eleven
Can any of the company-specific risk be diversified away by investing in both PayPal Holdings and Group Eleven 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 Group Eleven into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PayPal Holdings and Group Eleven Resources, you can compare the effects of market volatilities on PayPal Holdings and Group Eleven 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 Group Eleven. Check out your portfolio center. Please also check ongoing floating volatility patterns of PayPal Holdings and Group Eleven.
Diversification Opportunities for PayPal Holdings and Group Eleven
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between PayPal and Group is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding PayPal Holdings and Group Eleven Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Group Eleven Resources 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 Group Eleven. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Group Eleven Resources has no effect on the direction of PayPal Holdings i.e., PayPal Holdings and Group Eleven go up and down completely randomly.
Pair Corralation between PayPal Holdings and Group Eleven
Given the investment horizon of 90 days PayPal Holdings is expected to generate 0.22 times more return on investment than Group Eleven. However, PayPal Holdings is 4.47 times less risky than Group Eleven. It trades about 0.27 of its potential returns per unit of risk. Group Eleven Resources is currently generating about 0.03 per unit of risk. If you would invest 7,930 in PayPal Holdings on September 1, 2024 and sell it today you would earn a total of 747.00 from holding PayPal Holdings or generate 9.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 91.3% |
| Values | Daily Returns |
PayPal Holdings vs. Group Eleven Resources
Performance |
| Timeline |
| PayPal Holdings |
| Group Eleven Resources |
PayPal Holdings and Group Eleven Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PayPal Holdings and Group Eleven
The main advantage of trading using opposite PayPal Holdings and Group Eleven positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PayPal Holdings position performs unexpectedly, Group Eleven 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 Group Eleven will offset losses from the drop in Group Eleven's long position.| PayPal Holdings vs. SoFi Technologies | PayPal Holdings vs. Visa Class A | PayPal Holdings vs. Mastercard | PayPal Holdings vs. Capital One Financial |
| Group Eleven vs. Tinka Resources Limited | Group Eleven vs. Neo Battery Materials | Group Eleven vs. United States Antimony | Group Eleven vs. NioCorp Developments Ltd |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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