Correlation Between Smoore International and Pyxus International
Can any of the company-specific risk be diversified away by investing in both Smoore International and Pyxus International 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 Smoore International and Pyxus International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Smoore International Holdings and Pyxus International, you can compare the effects of market volatilities on Smoore International and Pyxus International 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 Smoore International with a short position of Pyxus International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Smoore International and Pyxus International.
Diversification Opportunities for Smoore International and Pyxus International
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Smoore and Pyxus is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Smoore International Holdings and Pyxus International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pyxus International and Smoore International 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 Smoore International Holdings are associated (or correlated) with Pyxus International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pyxus International has no effect on the direction of Smoore International i.e., Smoore International and Pyxus International go up and down completely randomly.
Pair Corralation between Smoore International and Pyxus International
Assuming the 90 days horizon Smoore International Holdings is expected to generate 0.4 times more return on investment than Pyxus International. However, Smoore International Holdings is 2.51 times less risky than Pyxus International. It trades about 0.1 of its potential returns per unit of risk. Pyxus International is currently generating about 0.0 per unit of risk. If you would invest 89.00 in Smoore International Holdings on September 3, 2024 and sell it today you would earn a total of 33.00 from holding Smoore International Holdings or generate 37.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Smoore International Holdings vs. Pyxus International
Performance |
| Timeline |
| Smoore International |
| Pyxus International |
Smoore International and Pyxus International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Smoore International and Pyxus International
The main advantage of trading using opposite Smoore International and Pyxus International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Smoore International position performs unexpectedly, Pyxus International 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 Pyxus International will offset losses from the drop in Pyxus International's long position.| Smoore International vs. Pyxus International | Smoore International vs. 22nd Century Group | Smoore International vs. Greenlane Holdings | Smoore International vs. Japan Tobacco |
| Pyxus International vs. PT Hanjaya Mandala | Pyxus International vs. Greenlane Holdings | Pyxus International vs. 22nd Century Group | Pyxus International vs. Japan Tobacco ADR |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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