Correlation Between Retail Food and Pointsbet Holdings
Can any of the company-specific risk be diversified away by investing in both Retail Food and Pointsbet 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 Retail Food and Pointsbet Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Retail Food Group and Pointsbet Holdings, you can compare the effects of market volatilities on Retail Food and Pointsbet 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 Retail Food with a short position of Pointsbet Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Retail Food and Pointsbet Holdings.
Diversification Opportunities for Retail Food and Pointsbet Holdings
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Retail and Pointsbet is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Retail Food Group and Pointsbet Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pointsbet Holdings and Retail Food 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 Retail Food Group are associated (or correlated) with Pointsbet Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pointsbet Holdings has no effect on the direction of Retail Food i.e., Retail Food and Pointsbet Holdings go up and down completely randomly.
Pair Corralation between Retail Food and Pointsbet Holdings
Assuming the 90 days trading horizon Retail Food is expected to generate 3.95 times less return on investment than Pointsbet Holdings. But when comparing it to its historical volatility, Retail Food Group is 1.28 times less risky than Pointsbet Holdings. It trades about 0.09 of its potential returns per unit of risk. Pointsbet Holdings is currently generating about 0.28 of returns per unit of risk over similar time horizon. If you would invest 70.00 in Pointsbet Holdings on August 30, 2024 and sell it today you would earn a total of 32.00 from holding Pointsbet Holdings or generate 45.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 97.73% |
| Values | Daily Returns |
Retail Food Group vs. Pointsbet Holdings
Performance |
| Timeline |
| Retail Food Group |
| Pointsbet Holdings |
Retail Food and Pointsbet Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Retail Food and Pointsbet Holdings
The main advantage of trading using opposite Retail Food and Pointsbet Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Retail Food position performs unexpectedly, Pointsbet 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 Pointsbet Holdings will offset losses from the drop in Pointsbet Holdings' long position.| Retail Food vs. Pinnacle Investment Management | Retail Food vs. Oceania Healthcare | Retail Food vs. Red Hill Iron | Retail Food vs. Centaurus Metals |
| Pointsbet Holdings vs. Retail Food Group | Pointsbet Holdings vs. Alto Metals | Pointsbet Holdings vs. Mayfield Childcare | Pointsbet Holdings vs. Stelar Metals |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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