Correlation Between Pointsbet Holdings and Pact Group

Can any of the company-specific risk be diversified away by investing in both Pointsbet Holdings and Pact Group 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 Pointsbet Holdings and Pact Group into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Pointsbet Holdings and Pact Group Holdings, you can compare the effects of market volatilities on Pointsbet Holdings and Pact Group 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 Pointsbet Holdings with a short position of Pact Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pointsbet Holdings and Pact Group.

Diversification Opportunities for Pointsbet Holdings and Pact Group

0.38

Correlation Coefficient

Pointsbet Holdings  Pact Group

Weak diversification

The 3 months correlation between Pointsbet and Pact is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Pointsbet Holdings and Pact Group Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pact Group Holdings and Pointsbet Holdings 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 Pointsbet Holdings are associated (or correlated) with Pact Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pact Group Holdings has no effect on the direction of Pointsbet Holdings i.e., Pointsbet Holdings and Pact Group go up and down completely randomly.

Pair Corralation between Pointsbet Holdings and Pact Group

Assuming the 90 days trading horizon Pointsbet Holdings is expected to generate 3.52 times less return on investment than Pact Group. In addition to that, Pointsbet Holdings is 1.49 times more volatile than Pact Group Holdings. It trades about 0.04 of its total potential returns per unit of risk. Pact Group Holdings is currently generating about 0.19 per unit of volatility. If you would invest  81.00  in Pact Group Holdings on December 29, 2024 and sell it today you would earn a total of  36.00  from holding Pact Group Holdings or generate 44.44% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.44%
Values	Daily Returns

Pointsbet Holdings  vs.  Pact Group Holdings

Pointsbet Holdings

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Pointsbet Holdings are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain technical indicators, Pointsbet Holdings may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pact Group Holdings

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Pact Group Holdings are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain technical indicators, Pact Group unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Pointsbet Holdings and Pact Group

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

The idea behind Pointsbet Holdings and Pact Group Holdings 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.