Correlation Between SoFi Technologies and Japan Post
Can any of the company-specific risk be diversified away by investing in both SoFi Technologies and Japan Post 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 SoFi Technologies and Japan Post into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SoFi Technologies and Japan Post Holdings, you can compare the effects of market volatilities on SoFi Technologies and Japan Post 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 SoFi Technologies with a short position of Japan Post. Check out your portfolio center. Please also check ongoing floating volatility patterns of SoFi Technologies and Japan Post.
Diversification Opportunities for SoFi Technologies and Japan Post
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between SoFi and Japan is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding SoFi Technologies and Japan Post Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Japan Post Holdings and SoFi Technologies 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 SoFi Technologies are associated (or correlated) with Japan Post. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Japan Post Holdings has no effect on the direction of SoFi Technologies i.e., SoFi Technologies and Japan Post go up and down completely randomly.
Pair Corralation between SoFi Technologies and Japan Post
If you would invest 1,042 in SoFi Technologies on August 24, 2024 and sell it today you would earn a total of 459.00 from holding SoFi Technologies or generate 44.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 4.35% |
| Values | Daily Returns |
SoFi Technologies vs. Japan Post Holdings
Performance |
| Timeline |
| SoFi Technologies |
| Japan Post Holdings |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
SoFi Technologies and Japan Post Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SoFi Technologies and Japan Post
The main advantage of trading using opposite SoFi Technologies and Japan Post positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SoFi Technologies position performs unexpectedly, Japan Post 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 Japan Post will offset losses from the drop in Japan Post's long position.| SoFi Technologies vs. Upstart Holdings | SoFi Technologies vs. Affirm Holdings | SoFi Technologies vs. Lucid Group | SoFi Technologies vs. Palantir Technologies |
| Japan Post vs. Huntington Bancshares Incorporated | Japan Post vs. Fifth Third Bancorp | Japan Post vs. MT Bank | Japan Post vs. Citizens Financial Group, |
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.
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