Correlation Between FEDEX and Payoneer Global

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

By analyzing existing cross correlation between FEDEX P 42 and Payoneer Global, you can compare the effects of market volatilities on FEDEX and Payoneer Global 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 FEDEX with a short position of Payoneer Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of FEDEX and Payoneer Global.

Diversification Opportunities for FEDEX and Payoneer Global

-0.28

Correlation Coefficient

FEDEX  Payoneer Global

Very good diversification

The 3 months correlation between FEDEX and Payoneer is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding FEDEX P 42 and Payoneer Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Payoneer Global and FEDEX 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 FEDEX P 42 are associated (or correlated) with Payoneer Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Payoneer Global has no effect on the direction of FEDEX i.e., FEDEX and Payoneer Global go up and down completely randomly.

Pair Corralation between FEDEX and Payoneer Global

Assuming the 90 days trading horizon FEDEX P 42 is expected to under-perform the Payoneer Global. But the bond apears to be less risky and, when comparing its historical volatility, FEDEX P 42 is 1.81 times less risky than Payoneer Global. The bond trades about -0.04 of its potential returns per unit of risk. The Payoneer Global is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest  758.00  in Payoneer Global on September 19, 2024 and sell it today you would earn a total of  235.00  from holding Payoneer Global or generate 31.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	89.06%
Values	Daily Returns

FEDEX P 42  vs.  Payoneer Global

FEDEX P 42

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days FEDEX P 42 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, FEDEX is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Payoneer Global

Risk-Adjusted Performance

11 of 100

Good

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

Pair Trading with FEDEX and Payoneer Global

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

The idea behind FEDEX P 42 and Payoneer Global 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.