Correlation Between PayPal Holdings and Mill City

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

By analyzing existing cross correlation between PayPal Holdings and Mill City Ventures, you can compare the effects of market volatilities on PayPal Holdings and Mill City 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 Mill City. Check out your portfolio center. Please also check ongoing floating volatility patterns of PayPal Holdings and Mill City.

Diversification Opportunities for PayPal Holdings and Mill City

-0.66

Correlation Coefficient

PayPal Holdings  Mill City

Excellent diversification

The 3 months correlation between PayPal and Mill is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding PayPal Holdings and Mill City Ventures in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mill City Ventures 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 Mill City. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mill City Ventures has no effect on the direction of PayPal Holdings i.e., PayPal Holdings and Mill City go up and down completely randomly.

Pair Corralation between PayPal Holdings and Mill City

Given the investment horizon of 90 days PayPal Holdings is expected to generate 44.06 times less return on investment than Mill City. But when comparing it to its historical volatility, PayPal Holdings is 42.79 times less risky than Mill City. It trades about 0.08 of its potential returns per unit of risk. Mill City Ventures is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  270.00  in Mill City Ventures on October 5, 2024 and sell it today you would lose (74.00) from holding Mill City Ventures or give up 27.41% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	92.91%
Values	Daily Returns

PayPal Holdings  vs.  Mill City Ventures

PayPal Holdings

Risk-Adjusted Performance

5 of 100

Modest

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

Mill City Ventures

Risk-Adjusted Performance

1 of 100

Very Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Mill City Ventures are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Mill City is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with PayPal Holdings and Mill City

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

The idea behind PayPal Holdings and Mill City Ventures 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.

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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.