Correlation Between Sterling Check and PagSeguro Digital
Can any of the company-specific risk be diversified away by investing in both Sterling Check and PagSeguro Digital 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 Sterling Check and PagSeguro Digital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sterling Check Corp and PagSeguro Digital, you can compare the effects of market volatilities on Sterling Check and PagSeguro Digital 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 Sterling Check with a short position of PagSeguro Digital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sterling Check and PagSeguro Digital.
Diversification Opportunities for Sterling Check and PagSeguro Digital
-0.84 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Sterling and PagSeguro is -0.84. Overlapping area represents the amount of risk that can be diversified away by holding Sterling Check Corp and PagSeguro Digital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PagSeguro Digital and Sterling Check 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 Sterling Check Corp are associated (or correlated) with PagSeguro Digital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PagSeguro Digital has no effect on the direction of Sterling Check i.e., Sterling Check and PagSeguro Digital go up and down completely randomly.
Pair Corralation between Sterling Check and PagSeguro Digital
Given the investment horizon of 90 days Sterling Check Corp is expected to generate 0.86 times more return on investment than PagSeguro Digital. However, Sterling Check Corp is 1.16 times less risky than PagSeguro Digital. It trades about 0.07 of its potential returns per unit of risk. PagSeguro Digital is currently generating about -0.08 per unit of risk. If you would invest 1,326 in Sterling Check Corp on November 3, 2024 and sell it today you would earn a total of 348.00 from holding Sterling Check Corp or generate 26.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 75.0% |
| Values | Daily Returns |
Sterling Check Corp vs. PagSeguro Digital
Performance |
| Timeline |
| Sterling Check Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| PagSeguro Digital |
Sterling Check and PagSeguro Digital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sterling Check and PagSeguro Digital
The main advantage of trading using opposite Sterling Check and PagSeguro Digital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sterling Check position performs unexpectedly, PagSeguro Digital 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 PagSeguro Digital will offset losses from the drop in PagSeguro Digital's long position.| Sterling Check vs. EverCommerce | Sterling Check vs. Evertec | Sterling Check vs. Consensus Cloud Solutions | Sterling Check vs. CSG Systems International |
| PagSeguro Digital vs. Marqeta | PagSeguro Digital vs. StoneCo | PagSeguro Digital vs. Confluent | PagSeguro Digital vs. Dlocal |
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 Stocks Directory module to find actively traded stocks across global markets.
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