Correlation Between PayPal Holdings and 63858SAA7

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both PayPal Holdings and 63858SAA7 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 63858SAA7 into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PayPal Holdings and BANK OF AMERICA, you can compare the effects of market volatilities on PayPal Holdings and 63858SAA7 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 63858SAA7. Check out your portfolio center. Please also check ongoing floating volatility patterns of PayPal Holdings and 63858SAA7.

Diversification Opportunities for PayPal Holdings and 63858SAA7

-0.15
  Correlation Coefficient

Good diversification

The 3 months correlation between PayPal and 63858SAA7 is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding PayPal Holdings and BANK OF AMERICA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BANK OF AMERICA 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 63858SAA7. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BANK OF AMERICA has no effect on the direction of PayPal Holdings i.e., PayPal Holdings and 63858SAA7 go up and down completely randomly.

Pair Corralation between PayPal Holdings and 63858SAA7

Given the investment horizon of 90 days PayPal Holdings is expected to generate 3.6 times more return on investment than 63858SAA7. However, PayPal Holdings is 3.6 times more volatile than BANK OF AMERICA. It trades about 0.08 of its potential returns per unit of risk. BANK OF AMERICA is currently generating about 0.0 per unit of risk. If you would invest  5,904  in PayPal Holdings on September 4, 2024 and sell it today you would earn a total of  2,610  from holding PayPal Holdings or generate 44.21% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy59.11%
ValuesDaily Returns

PayPal Holdings  vs.  BANK OF AMERICA

 Performance 
       Timeline  
PayPal Holdings 

Risk-Adjusted Performance

11 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in PayPal Holdings are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite quite weak basic indicators, PayPal Holdings disclosed solid returns over the last few months and may actually be approaching a breakup point.
BANK OF AMERICA 

Risk-Adjusted Performance

13 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in BANK OF AMERICA are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain basic indicators, 63858SAA7 may actually be approaching a critical reversion point that can send shares even higher in January 2025.

PayPal Holdings and 63858SAA7 Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with PayPal Holdings and 63858SAA7

The main advantage of trading using opposite PayPal Holdings and 63858SAA7 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PayPal Holdings position performs unexpectedly, 63858SAA7 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 63858SAA7 will offset losses from the drop in 63858SAA7's long position.
PayPal Holdings vs. American Express
PayPal Holdings vs. Upstart Holdings
PayPal Holdings vs. Capital One Financial
PayPal Holdings vs. Visa Class A
The idea behind PayPal Holdings and BANK OF AMERICA pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
63858SAA7 vs. The Joint Corp
63858SAA7 vs. Hafnia Limited
63858SAA7 vs. KNOT Offshore Partners
63858SAA7 vs. Teleflex Incorporated
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.

Other Complementary Tools

Aroon Oscillator
Analyze current equity momentum using Aroon Oscillator and other momentum ratios
Bollinger Bands
Use Bollinger Bands indicator to analyze target price for a given investing horizon
Idea Analyzer
Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas
USA ETFs
Find actively traded Exchange Traded Funds (ETF) in USA
Idea Optimizer
Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio


 
Macroaxis helps investors of all levels and skills to maximize the upside of all their holdings and minimize the risk associated with market volatility, economic swings, and company-specific events. View terms and conditions
 
Feedback Blog
Made with optimal in San Francisco
2024 Macroaxis LLC
COMMON DESTINATIONS
MAIN CATEGORIES
COMPANY