Correlation Between PayPal Holdings and Grupa KTY
Can any of the company-specific risk be diversified away by investing in both PayPal Holdings and Grupa KTY 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 Grupa KTY into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PayPal Holdings and Grupa KTY SA, you can compare the effects of market volatilities on PayPal Holdings and Grupa KTY 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 Grupa KTY. Check out your portfolio center. Please also check ongoing floating volatility patterns of PayPal Holdings and Grupa KTY.
Diversification Opportunities for PayPal Holdings and Grupa KTY
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between PayPal and Grupa is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding PayPal Holdings and Grupa KTY SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grupa KTY SA 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 Grupa KTY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grupa KTY SA has no effect on the direction of PayPal Holdings i.e., PayPal Holdings and Grupa KTY go up and down completely randomly.
Pair Corralation between PayPal Holdings and Grupa KTY
Given the investment horizon of 90 days PayPal Holdings is expected to generate 0.87 times more return on investment than Grupa KTY. However, PayPal Holdings is 1.15 times less risky than Grupa KTY. It trades about 0.24 of its potential returns per unit of risk. Grupa KTY SA is currently generating about 0.16 per unit of risk. If you would invest 8,141 in PayPal Holdings on September 7, 2024 and sell it today you would earn a total of 764.00 from holding PayPal Holdings or generate 9.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PayPal Holdings vs. Grupa KTY SA
Performance |
| Timeline |
| PayPal Holdings |
| Grupa KTY SA |
PayPal Holdings and Grupa KTY Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PayPal Holdings and Grupa KTY
The main advantage of trading using opposite PayPal Holdings and Grupa KTY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PayPal Holdings position performs unexpectedly, Grupa KTY 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 Grupa KTY will offset losses from the drop in Grupa KTY's long position.| PayPal Holdings vs. SoFi Technologies | PayPal Holdings vs. Visa Class A | PayPal Holdings vs. Mastercard | PayPal Holdings vs. Capital One Financial |
| Grupa KTY vs. New Tech Venture | Grupa KTY vs. PLAYWAY SA | Grupa KTY vs. ING Bank lski | Grupa KTY vs. Santander Bank Polska |
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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