Correlation Between PKSHA TECHNOLOGY and Sumitomo Mitsui

Can any of the company-specific risk be diversified away by investing in both PKSHA TECHNOLOGY and Sumitomo Mitsui 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 PKSHA TECHNOLOGY and Sumitomo Mitsui into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between PKSHA TECHNOLOGY INC and Sumitomo Mitsui Financial, you can compare the effects of market volatilities on PKSHA TECHNOLOGY and Sumitomo Mitsui 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 PKSHA TECHNOLOGY with a short position of Sumitomo Mitsui. Check out your portfolio center. Please also check ongoing floating volatility patterns of PKSHA TECHNOLOGY and Sumitomo Mitsui.

Diversification Opportunities for PKSHA TECHNOLOGY and Sumitomo Mitsui

0.0

Correlation Coefficient

PKSHA TECHNOLOGY  Sumitomo Mitsui

Pay attention - limited upside

The 3 months correlation between PKSHA and Sumitomo is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding PKSHA TECHNOLOGY INC and Sumitomo Mitsui Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sumitomo Mitsui Financial and PKSHA TECHNOLOGY 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 PKSHA TECHNOLOGY INC are associated (or correlated) with Sumitomo Mitsui. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sumitomo Mitsui Financial has no effect on the direction of PKSHA TECHNOLOGY i.e., PKSHA TECHNOLOGY and Sumitomo Mitsui go up and down completely randomly.

Pair Corralation between PKSHA TECHNOLOGY and Sumitomo Mitsui

If you would invest  0.00  in Sumitomo Mitsui Financial on October 10, 2024 and sell it today you would earn a total of  0.00  from holding Sumitomo Mitsui Financial or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	5.88%
Values	Daily Returns

PKSHA TECHNOLOGY INC  vs.  Sumitomo Mitsui Financial

PKSHA TECHNOLOGY INC

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in PKSHA TECHNOLOGY INC are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, PKSHA TECHNOLOGY may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Sumitomo Mitsui Financial

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Sumitomo Mitsui Financial has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Sumitomo Mitsui is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with PKSHA TECHNOLOGY and Sumitomo Mitsui

The main advantage of trading using opposite PKSHA TECHNOLOGY and Sumitomo Mitsui positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PKSHA TECHNOLOGY position performs unexpectedly, Sumitomo Mitsui 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 Sumitomo Mitsui will offset losses from the drop in Sumitomo Mitsui's long position.

The idea behind PKSHA TECHNOLOGY INC and Sumitomo Mitsui Financial pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..