Correlation Between PayPal Holdings and Prodea Real
Can any of the company-specific risk be diversified away by investing in both PayPal Holdings and Prodea Real 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 Prodea Real into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PayPal Holdings and Prodea Real Estate, you can compare the effects of market volatilities on PayPal Holdings and Prodea Real 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 Prodea Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of PayPal Holdings and Prodea Real.
Diversification Opportunities for PayPal Holdings and Prodea Real
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between PayPal and Prodea is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding PayPal Holdings and Prodea Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Prodea Real Estate 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 Prodea Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Prodea Real Estate has no effect on the direction of PayPal Holdings i.e., PayPal Holdings and Prodea Real go up and down completely randomly.
Pair Corralation between PayPal Holdings and Prodea Real
Given the investment horizon of 90 days PayPal Holdings is expected to generate 0.96 times more return on investment than Prodea Real. However, PayPal Holdings is 1.04 times less risky than Prodea Real. It trades about 0.03 of its potential returns per unit of risk. Prodea Real Estate is currently generating about -0.02 per unit of risk. If you would invest 7,370 in PayPal Holdings on September 3, 2024 and sell it today you would earn a total of 1,307 from holding PayPal Holdings or generate 17.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 82.42% |
| Values | Daily Returns |
PayPal Holdings vs. Prodea Real Estate
Performance |
| Timeline |
| PayPal Holdings |
| Prodea Real Estate |
PayPal Holdings and Prodea Real Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PayPal Holdings and Prodea Real
The main advantage of trading using opposite PayPal Holdings and Prodea Real positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PayPal Holdings position performs unexpectedly, Prodea Real 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 Prodea Real will offset losses from the drop in Prodea Real's long position.| PayPal Holdings vs. American Express | PayPal Holdings vs. Capital One Financial | PayPal Holdings vs. Upstart Holdings | PayPal Holdings vs. Ally Financial |
| Prodea Real vs. Hellenic Telecommunications Organization | Prodea Real vs. Profile Systems Software | Prodea Real vs. Optima bank SA | Prodea Real vs. As Commercial Industrial |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
Other Complementary Tools
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk |