Correlation Between CoreShares Preference and Prosus NV

Can any of the company-specific risk be diversified away by investing in both CoreShares Preference and Prosus NV 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 CoreShares Preference and Prosus NV into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between CoreShares Preference Share and Prosus NV, you can compare the effects of market volatilities on CoreShares Preference and Prosus NV 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 CoreShares Preference with a short position of Prosus NV. Check out your portfolio center. Please also check ongoing floating volatility patterns of CoreShares Preference and Prosus NV.

Diversification Opportunities for CoreShares Preference and Prosus NV

0.0

Correlation Coefficient

CoreShares Preference  Prosus NV

Pay attention - limited upside

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

Pair Corralation between CoreShares Preference and Prosus NV

If you would invest  7,600,100  in Prosus NV on December 26, 2024 and sell it today you would earn a total of  914,900  from holding Prosus NV or generate 12.04% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

CoreShares Preference Share  vs.  Prosus NV

CoreShares Preference

Risk-Adjusted Performance

Very Weak

Over the last 90 days CoreShares Preference Share has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong technical and fundamental indicators, CoreShares Preference is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Prosus NV

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Prosus NV are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady technical and fundamental indicators, Prosus NV exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with CoreShares Preference and Prosus NV

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

The idea behind CoreShares Preference Share and Prosus NV 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.