Correlation Between EVO Payments and Pan American

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

By analyzing existing cross correlation between EVO Payments and Pan American Silver, you can compare the effects of market volatilities on EVO Payments and Pan American 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 EVO Payments with a short position of Pan American. Check out your portfolio center. Please also check ongoing floating volatility patterns of EVO Payments and Pan American.

Diversification Opportunities for EVO Payments and Pan American

-0.06

Correlation Coefficient

EVO Payments  Pan American

Good diversification

The 3 months correlation between EVO and Pan is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding EVO Payments and Pan American Silver in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pan American Silver and EVO Payments 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 EVO Payments are associated (or correlated) with Pan American. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pan American Silver has no effect on the direction of EVO Payments i.e., EVO Payments and Pan American go up and down completely randomly.

Pair Corralation between EVO Payments and Pan American

If you would invest  1,525  in Pan American Silver on January 31, 2024 and sell it today you would earn a total of  398.00  from holding Pan American Silver or generate 26.1% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	4.76%
Values	Daily Returns

EVO Payments  vs.  Pan American Silver

EVO Payments

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days EVO Payments has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, EVO Payments is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Pan American Silver

Risk-Adjusted Performance

17 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Pan American Silver are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unfluctuating basic indicators, Pan American unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with EVO Payments and Pan American

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

The idea behind EVO Payments and Pan American Silver 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.