Correlation Between Ryvyl and Pagaya Technologies

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

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

Diversification Opportunities for Ryvyl and Pagaya Technologies

-0.1

Correlation Coefficient

Ryvyl  Pagaya Technologies

Good diversification

The 3 months correlation between Ryvyl and Pagaya is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Ryvyl Inc and Pagaya Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pagaya Technologies and Ryvyl 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 Ryvyl Inc are associated (or correlated) with Pagaya Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pagaya Technologies has no effect on the direction of Ryvyl i.e., Ryvyl and Pagaya Technologies go up and down completely randomly.

Pair Corralation between Ryvyl and Pagaya Technologies

Given the investment horizon of 90 days Ryvyl Inc is expected to generate 1.47 times more return on investment than Pagaya Technologies. However, Ryvyl is 1.47 times more volatile than Pagaya Technologies. It trades about 0.13 of its potential returns per unit of risk. Pagaya Technologies is currently generating about -0.03 per unit of risk. If you would invest  108.00  in Ryvyl Inc on August 30, 2024 and sell it today you would earn a total of  77.00  from holding Ryvyl Inc or generate 71.3% return on investment over 90 days.

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

Ryvyl Inc  vs.  Pagaya Technologies

Ryvyl Inc

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Ryvyl Inc are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite quite weak basic indicators, Ryvyl disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pagaya Technologies

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Pagaya Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's technical and fundamental indicators remain fairly strong which may send shares a bit higher in December 2024. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Ryvyl and Pagaya Technologies

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

The idea behind Ryvyl Inc and Pagaya Technologies 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.