Correlation Between Sharing Economy and Paymentus Holdings

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

By analyzing existing cross correlation between Sharing Economy International and Paymentus Holdings, you can compare the effects of market volatilities on Sharing Economy and Paymentus Holdings 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 Sharing Economy with a short position of Paymentus Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sharing Economy and Paymentus Holdings.

Diversification Opportunities for Sharing Economy and Paymentus Holdings

-0.02

Correlation Coefficient

Sharing Economy  Paymentus Holdings

Good diversification

The 3 months correlation between Sharing and Paymentus is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Sharing Economy International and Paymentus Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Paymentus Holdings and Sharing Economy 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 Sharing Economy International are associated (or correlated) with Paymentus Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Paymentus Holdings has no effect on the direction of Sharing Economy i.e., Sharing Economy and Paymentus Holdings go up and down completely randomly.

Pair Corralation between Sharing Economy and Paymentus Holdings

If you would invest  0.25  in Sharing Economy International on October 20, 2024 and sell it today you would earn a total of  0.00  from holding Sharing Economy International or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	5.0%
Values	Daily Returns

Sharing Economy International  vs.  Paymentus Holdings

Sharing Economy Inte

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Sharing Economy International has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong forward indicators, Sharing Economy is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

Paymentus Holdings

Risk-Adjusted Performance

6 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Paymentus Holdings are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of fairly uncertain basic indicators, Paymentus Holdings showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Sharing Economy and Paymentus Holdings

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

The idea behind Sharing Economy International and Paymentus Holdings 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.