Correlation Between Paysafe and ViacomCBS

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

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

Diversification Opportunities for Paysafe and ViacomCBS

0.0

Correlation Coefficient

Paysafe  ViacomCBS

Pay attention - limited upside

The 3 months correlation between Paysafe and ViacomCBS is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Paysafe and ViacomCBS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ViacomCBS and Paysafe 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 Paysafe are associated (or correlated) with ViacomCBS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ViacomCBS has no effect on the direction of Paysafe i.e., Paysafe and ViacomCBS go up and down completely randomly.

Pair Corralation between Paysafe and ViacomCBS

If you would invest  1,367  in Paysafe on February 19, 2024 and sell it today you would earn a total of  450.00  from holding Paysafe or generate 32.92% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Paysafe  vs.  ViacomCBS

Paysafe

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Paysafe are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak technical and fundamental indicators, Paysafe exhibited solid returns over the last few months and may actually be approaching a breakup point.

ViacomCBS

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ViacomCBS has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable fundamental drivers, ViacomCBS is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Paysafe and ViacomCBS

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

The idea behind Paysafe and ViacomCBS 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.