Correlation Between PSG FINANCIAL and PHOENIX BEVERAGES

Can any of the company-specific risk be diversified away by investing in both PSG FINANCIAL and PHOENIX BEVERAGES 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 PSG FINANCIAL and PHOENIX BEVERAGES into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between PSG FINANCIAL SERVICES and PHOENIX BEVERAGES LTD, you can compare the effects of market volatilities on PSG FINANCIAL and PHOENIX BEVERAGES 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 PSG FINANCIAL with a short position of PHOENIX BEVERAGES. Check out your portfolio center. Please also check ongoing floating volatility patterns of PSG FINANCIAL and PHOENIX BEVERAGES.

Diversification Opportunities for PSG FINANCIAL and PHOENIX BEVERAGES

0.0

Correlation Coefficient

PSG FINANCIAL  PHOENIX BEVERAGES

Pay attention - limited upside

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

Pair Corralation between PSG FINANCIAL and PHOENIX BEVERAGES

If you would invest  54,200  in PHOENIX BEVERAGES LTD on December 28, 2024 and sell it today you would earn a total of  7,800  from holding PHOENIX BEVERAGES LTD or generate 14.39% return on investment over 90 days.

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

PSG FINANCIAL SERVICES  vs.  PHOENIX BEVERAGES LTD

PSG FINANCIAL SERVICES

Risk-Adjusted Performance

Very Weak

Over the last 90 days PSG FINANCIAL SERVICES has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound technical and fundamental indicators, PSG FINANCIAL is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

PHOENIX BEVERAGES LTD

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in PHOENIX BEVERAGES LTD are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of very weak primary indicators, PHOENIX BEVERAGES displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with PSG FINANCIAL and PHOENIX BEVERAGES

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

The idea behind PSG FINANCIAL SERVICES and PHOENIX BEVERAGES LTD 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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.