Correlation Between PayPal Holdings and Loomis Sayles
Can any of the company-specific risk be diversified away by investing in both PayPal Holdings and Loomis Sayles 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 PayPal Holdings and Loomis Sayles into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PayPal Holdings and Loomis Sayles Global, you can compare the effects of market volatilities on PayPal Holdings and Loomis Sayles 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 PayPal Holdings with a short position of Loomis Sayles. Check out your portfolio center. Please also check ongoing floating volatility patterns of PayPal Holdings and Loomis Sayles.
Diversification Opportunities for PayPal Holdings and Loomis Sayles
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between PayPal and Loomis is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding PayPal Holdings and Loomis Sayles Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Loomis Sayles Global and PayPal 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 PayPal Holdings are associated (or correlated) with Loomis Sayles. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Loomis Sayles Global has no effect on the direction of PayPal Holdings i.e., PayPal Holdings and Loomis Sayles go up and down completely randomly.
Pair Corralation between PayPal Holdings and Loomis Sayles
Given the investment horizon of 90 days PayPal Holdings is expected to under-perform the Loomis Sayles. In addition to that, PayPal Holdings is 3.47 times more volatile than Loomis Sayles Global. It trades about -0.16 of its total potential returns per unit of risk. Loomis Sayles Global is currently generating about -0.05 per unit of volatility. If you would invest 2,427 in Loomis Sayles Global on December 28, 2024 and sell it today you would lose (56.00) from holding Loomis Sayles Global or give up 2.31% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
PayPal Holdings vs. Loomis Sayles Global
Performance |
Timeline |
PayPal Holdings |
Loomis Sayles Global |
PayPal Holdings and Loomis Sayles Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with PayPal Holdings and Loomis Sayles
The main advantage of trading using opposite PayPal Holdings and Loomis Sayles positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PayPal Holdings position performs unexpectedly, Loomis Sayles 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 Loomis Sayles will offset losses from the drop in Loomis Sayles' long position.PayPal Holdings vs. SoFi Technologies | PayPal Holdings vs. Visa Class A | PayPal Holdings vs. Mastercard | PayPal Holdings vs. Capital One Financial |
Loomis Sayles vs. Loomis Sayles Global | Loomis Sayles vs. Natixis Equity Opportunities | Loomis Sayles vs. Loomis Sayles Global | Loomis Sayles vs. Loomis Sayles Growth |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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