Correlation Between SK Growth and Papaya Growth
Can any of the company-specific risk be diversified away by investing in both SK Growth and Papaya Growth 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 SK Growth and Papaya Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SK Growth Opportunities and Papaya Growth Opportunity, you can compare the effects of market volatilities on SK Growth and Papaya Growth 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 SK Growth with a short position of Papaya Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of SK Growth and Papaya Growth.
Diversification Opportunities for SK Growth and Papaya Growth
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between SKGR and Papaya is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding SK Growth Opportunities and Papaya Growth Opportunity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Papaya Growth Opportunity and SK Growth 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 SK Growth Opportunities are associated (or correlated) with Papaya Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Papaya Growth Opportunity has no effect on the direction of SK Growth i.e., SK Growth and Papaya Growth go up and down completely randomly.
Pair Corralation between SK Growth and Papaya Growth
Given the investment horizon of 90 days SK Growth Opportunities is expected to generate 0.13 times more return on investment than Papaya Growth. However, SK Growth Opportunities is 7.62 times less risky than Papaya Growth. It trades about 0.17 of its potential returns per unit of risk. Papaya Growth Opportunity is currently generating about 0.01 per unit of risk. If you would invest 1,115 in SK Growth Opportunities on September 3, 2024 and sell it today you would earn a total of 39.00 from holding SK Growth Opportunities or generate 3.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SK Growth Opportunities vs. Papaya Growth Opportunity
Performance |
| Timeline |
| SK Growth Opportunities |
| Papaya Growth Opportunity |
SK Growth and Papaya Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SK Growth and Papaya Growth
The main advantage of trading using opposite SK Growth and Papaya Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SK Growth position performs unexpectedly, Papaya Growth 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 Papaya Growth will offset losses from the drop in Papaya Growth's long position.| SK Growth vs. Four Leaf Acquisition | SK Growth vs. WinVest Acquisition Corp | SK Growth vs. Thunder Bridge Capital | SK Growth vs. Pearl Holdings Acquisition |
| Papaya Growth vs. Alpha One | Papaya Growth vs. Manaris Corp | Papaya Growth vs. SCOR PK | Papaya Growth vs. Aquagold International |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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